Asked by Madyson Mulkey on Jun 01, 2024
Verified
Marginal revenue (MR) is
A) TR/q.
B) ΔTR/Δq.
C) P x q.
D) P/q.
Marginal Revenue
The additional income generated from selling one more unit of a product or service, crucial for decision-making in production and pricing strategies.
ΔTR/Δq
Represents the change in total revenue divided by the change in quantity sold, indicating marginal revenue.
TR/q
Represents Total Revenue divided by quantity, a formula used to calculate average revenue per unit sold.
- Understand the principle of profit maximization for a perfectly competitive firm and the primary decision-making focus.
Verified Answer
MG
Mahathi GangavarapuJun 02, 2024
Final Answer :
B
Explanation :
Marginal revenue (MR) is defined as the change in total revenue (ΔTR) that results from selling one additional unit of a product or service, hence it is calculated as ΔTR/Δq.
Learning Objectives
- Understand the principle of profit maximization for a perfectly competitive firm and the primary decision-making focus.
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