Marginal, Average, and Total Revenue (AQA A-Level Economics): Quizzes
📚Quizzes
Practise the questions
10 questions from this quiz
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Practise the questions
10 questions from this quiz
How is total revenue (TR) calculated?
How is total revenue (TR) calculated?
Price per unit × quantity sold
What formula calculates average revenue (AR)?
What formula calculates average revenue (AR)?
What does marginal revenue (MR) measure?
What does marginal revenue (MR) measure?
Additional revenue from selling one more unit
What is the relationship between a firm's demand curve and its average revenue curve?
What is the relationship between a firm's demand curve and its average revenue curve?
They are identical
When marginal revenue is less than average revenue, what happens to average revenue?
When marginal revenue is less than average revenue, what happens to average revenue?
It falls
In perfect competition, what is the relationship between D, AR and MR?
In perfect competition, what is the relationship between D, AR and MR?
D = AR = MR
Why can't a perfectly competitive firm raise its price above the market price?
Why can't a perfectly competitive firm raise its price above the market price?
It would lose all sales to competitors
In monopoly, where does the MR curve lie relative to the AR curve?
In monopoly, where does the MR curve lie relative to the AR curve?
Below the AR curve
Why is MR less than price for a monopolist?
Why is MR less than price for a monopolist?
Price must fall on all units to sell more
Along a straight-line demand curve, where is demand elastic?
Along a straight-line demand curve, where is demand elastic?
In the upper portion