Question

What is relationship between the slope of the average revenue and marginal revenue.

Answer 1

Explanation:

When AR and MR are straight lines, sloping downwards, the marginal revenue falls twice as much as the fall in the average revenue. In other words, the marginal revenue will cut any line perpendicular to the y – axis at halfway to the average revenue curve

Answer 2

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SLOPE of marginal revenue curve is less than slope of marginal cost curve

• They have the same constant, and the marginal revenue curve is twice as steep as the demand curve.
• The coefficient on Q is twice as large in the marginal