How are the total revenue of a firm, market price, and the quantity sold by that firm related to each other?

(a) Let the LP be 100 So, cost price = 100 × 70% = 70 SP = 100 × 160% = 160 Profit = 160 – 70 = 90 When profit is 90, LP =...

Average Revenue is defined as the revenue per unit of the output sold. It is expressed as the ratio between total revenue and the output sold. AR = TR/Q We know that, TR...

Quantity Sold TR = P x Q MR = TRn - TRn - 1 AR = 10 0 - - - 1 10 x 1 = 10 10 - 0 = 10 10 2 10 x 2 = 20 20 - 10 = 10 10 3 10...

At Price, P1 = Rs 10 Total Revenue, TR1 = P1 x Q1 = 50 = TR1/P1 = Q1 = 50/10 = Q1 = Q1 = 5units At Price, = Rs 15 Total Revenue, TR2 =...

Initial Price, P1 = Rs 10 Initial Output, Q1 = 4 units Final Price, P2 = Rs 30 ΔP = P2 - P1 = Rs 30 - 10 = Rs 20 Elasticity of supply,es =...

Market price and average revenue of a price taking firm are equal. Both are indicated by a horizontal straight line. Because market price is constant for a price taking firm.

Average revenue is constant at all levels of output in a market in which a firm can sell any quantity of a good at a given price.

For a price taking firm, market price is equal to marginal revenue.

Total revenue is the multiplication of quantity sold and market price, whereas market price is the ratio of total revenue and quantity sold. TR = P X Q P = △TR/△Q

MR is constant at all levels of output.