Question

Explain Total Revenue (TR) curves.

Answer 1

The total revenue is the amount of money made by a producer or seller after the output is sold. Actually, the multiple of price and output equals total revenue. The market in which the company manufactures or sells determines how its overall revenue behaves.

TR = AR × Q

Where TR = Total Revenue

AR = Average Revenue or Price per Unit

Q = Output

For example, if the price of a commodity is ₹100 and total units sold are 20 in that case, the total revenue will be

TR = 100 × 20 = 2000

TR = 2000