Question

When output increases from 5 units to 8 units and TR increases from Rs 1200 to Rs 1500, then MR of 8th unit is:l​

Answer 1

Answer ⤵️

MR refers to change in TR when output changes by one unit.

MR= change in TR/ change in output level = (150-100)/(15-10) =50/ 5 =10

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Answer 2

When output increases from 8 units to 10 units and TR increases from Rs. 270 to Rs. 300, then MR is Rs 15.

Total increase in TR for 2 units= 300-270 =30

Total increase in TR for 1 unit= MR= 30/2 =15In perfectly competitive market any quantity can be demanded at the given price level.When a firm is able to sell more quantity of output at the same price, then AR=MR. Price line is the same as both firm's MR curve and firm's AR curve under the perfect competition.