If TR curve is constant and parallel to X Axis then give the AR and MR curves???
It means that since TR curve is constant and parallel to X axis Ed = 1
Hence the Demand Curve should be a rectangular Hyperbola
Dear student,
The TR cannot be constant. This is because with sale of additional units of output the firm would earn additional revenue even if it is the same as from the sale of previous unit. In such a situation the TR increases but at a constant rate, it is not fixed. Accordingly, the average revenue and marginal revenue are fixed.
The TR cannot be constant. This is because with sale of additional units of output the firm would earn additional revenue even if it is the same as from the sale of previous unit. In such a situation the TR increases but at a constant rate, it is not fixed. Accordingly, the average revenue and marginal revenue are fixed.