Question

3. Average revenue falls with an increase in
marginal revenue. True or false. Explain.​

Answer 1

⠀⠀ ⠀ ⠀⠀ $\huge{\tt{\red{❥}\green{A}\purple{N}\pink{S}\blue{W}\orange{E}\red{R}}}$If the price or average revenue remains the same when more units of a product are sold, the marginal revenue will be equal to average revenue.

Answer 2

{True}

A firm's average revenue is its total revenue earned divided by the total units. A competitive firm's marginal revenue always equals its average revenue and price. This is because the price remains constant over varying levels of output.

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