How do changes in marginal revenue affect total revenue?

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Solution

Marginal revenue is the rate of total revenue. The slope of total revenue is determined by the marginal revenue. That is why when MR is constant, Tr increases at a constant rate and when MR starts decreasing then the total revenue increases at a decreasing rate and when MR becomes negative then the TR starts falling.

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Explain the relationship between Marginal Revenue (MR) and Total Revenue (TR).

When the total revenue is maximum, the marginal revenue is ___

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