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Standard XII
Economics
The Multiplier Mechanism
Average reven...
Question
Average revenue is constant when marginal revenue is zero.
A
True
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B
False
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Solution
The correct option is
B
False
When marginal revenue is zero, average revenue should be diminishing, as shown in figure.
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Average revenue is maximum when marginal revenue reduces to zero.
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Explain the relationship between marginal revenue and average revenue.
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Total revenue is constant when marginal revenue is constant.
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