Question

show that average revenue of a product is also the price of the product​

Answer 1

Explanation:

Average revenue product, usually abbreviated ARP, is found by dividing total revenue by the variable input or by multiplying average physical product by average revenue. Average revenue product is a part of marginal productivity theory used to analyze the demand for productive inputs.

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Answer 2

The given is the example to show average revenue of a product is also the price of the product​.

Explanation:

The average revenue is the same as the price it can be proved by the following example, assume at price $2, and $4 the quantity demanded is 6 units and 4 units respectively. Thus, in this case, the total revenue can be determined by multiplying price with quantity.

So, when the price is $2 and the quantity is 6 then total revenue will $12. When the price is $4, and the quantity is 4 units the total revenue is $16. Now, find AR (average revenue, AR = TR / Q). when TR is $12 then AR is (12 / 6) = $2 however, when TR is $16 then AR is (16 / 4) = 4. Here, it can be seen that the average revenue and price is the same

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Average revenue of a product

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