The money that a firm earns per period (per day, say) from selling its product is called his total revenue (TR) per day. The formula for calculating total revenue can be written as: TR = p x q = TR(q) …. (3.1) Where p = price of the product And q = quantity sold per period Regarding the total revenue [...]
The average revenue of a firm is its revenue that is obtained on average from each physical unit of its sale. Therefore, AR shall be obtained, at any quantity of output sold, if the TR will be divided by the quantity of output itself. The formula for calculating average revue can be written as: At any q, AR = TR/q [...]
In this article we will discuss about the formula and equation for calculating the marginal revenue that the seller acquires by selling the good. Marginal Revenue (MR) of the firm at any quantity of output sold is the increment in its total revenue (TR) that is obtained when the firm sells the marginal (or the additional) unit of that quantity. [...]