Calculate Price (AR)and TR from the follwing data :

units of output ; 1 2 3 4

MR ; 20 16 9 3

In this what formula should we use, to find out AR

Question

Calculate Price (AR)and TR from the follwing data :
units of output ; 1 2 3 4
MR ; 20 16 9 3
In this what formula should we use, to find out AR

Amit Chatterjee · Accepted Answer

Dear Student, the solution has been provided below Go through it
and do let us know, if you still face any doubt

Output
(units)
Marginal Revenue
(MR)
(Rs)
Total
Revenue
(MRn = TRn
- TR n-1)
(Rs)
Average
Revenue
ARn=TRnOutput
(Rs)

1
20
MR1 = TR1 - TR1 -
1
20 = TR1 -
0
TR1 = 20
AR1=201= 20

2
16
MR2 = TR2 - TR2 -
1
20 =
TR2 -
16
TR2 = 36
AR2=362= 18

3
9
MR3 = TR3 - TR3 -
2
9 =
TR3 -
36
TR3 =
45

AR3=453= 15

4
3
MR4 = TR4 - TR4 -
3
3 = TR4 -
45
TR4 =
48

AR4=484= 12

Keep posting!!

Output (units)	Marginal Revenue (MR) (Rs)	Total Revenue (MR_n = TR_n - TR _n-1) (Rs)	Average Revenue $(A R_{n} = \frac{T R_{n}}{O u t p u t})$ (Rs)
1	20	MR₁ = TR₁ - TR₁_{- 1} 20 = TR₁- 0 TR₁= 20	$A R_{1} = \frac{20}{1} = 20$
2	16	MR₂ = TR₂ - TR₂_{- 1} 20 = TR₂- 16 TR₂ = 36	$A R_{2} = \frac{36}{2} = 18$
3	9	MR₃ = TR₃ - TR₃_{- 2} 9 = TR₃- 36 TR₃ = 45	$A R_{3} = \frac{45}{3} = 15$
4	3	MR₄ = TR₄ - TR₄_{- 3} 3 = TR₄- 45 TR₄ = 48	$A R_{4} = \frac{48}{4} = 12$