What is average revenue?

The revenue per unit of commodity sold

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The revenue from all commodities sold

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The profit realized from the marginal unit sold

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The profit realized by sale of all commodities

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Solution

The correct option is A The revenue per unit of commodity sold
Total revenue divided by the number of output sold is the average revenue earned. Alternatively it is also known as price.

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Similar questions

Explain the relation between marginal revenue and average revenue when a firm is able to sell more quantity of output :

(i) at the same price.

(ii) only by lowering the price.

Explain the effect of the following on the supply of a commodity :

(a) Fall in the prices of factor inputs.

(b) Rise in the prices of other commodities.

Outputs (Units):	1	2	3
AR(Rs.):	10	8	6

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