If the average revenue is $R s . 15$ per unit and demand curve is perfectly elastic and producer sells $10$ units of output, find total revenue. At what rate $T R$ of the producer will change?

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Solution

In case of perfectly elastic demand curve, AR=MR=Price.
Price =Rs.15
Total Revenue =Price ×Quantity
=Rs.15×10=Rs.150
Rate of change in TR=MR=Rs.15
For every additional unit sold, TR
increases by Rs.15.

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If the average revenue is Rs.15 per unit and demand curve is perfectly elastic and producer sells 10 units of output, find total revenue. At what rate TR of the producer will change?

In case of perfectly elastic demand curve, AR=MR=Price. Price =Rs.15Total Revenue =Price ×Quantity =Rs.15×10=Rs.150Rate of change in TR=MR=Rs.15For every additional unit sold, TR increases by Rs.15.

If the average revenue is $R s . 15$ per unit and demand curve is perfectly elastic and producer sells $10$ units of output, find total revenue. At what rate $T R$ of the producer will change?

In case of perfectly elastic demand curve, AR=MR=Price.
Price =Rs.15
Total Revenue =Price ×Quantity
=Rs.15×10=Rs.150
Rate of change in TR=MR=Rs.15
For every additional unit sold, TR
increases by Rs.15.