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Revenue


Question 1

Consider the example of a firm which produces and sells studio recording equipment.

PRICE (£) QUANTITY DEMANDED (000) TOTAL REVENUE (000) MARGINAL REVENUE (000)
10 3    
9 4    
8 5    
7 6    
6 7    
5 8    
4 9    
3 10    
2 11    
1 12    

  1. Using the information contained in the example calculate total and marginal revenue.

  2. Plot total, average and marginal revenue.

  3. When TR is at a maximum, what is MR?

Answer