Which of the following is true for marginal revenue and total revenue?
A) The marginal revenue curve is upward sloping while the total revenue curve is a straight line.
B) The total revenue curve is the inverse of marginal revenue curve.
C) Marginal revenue is equal to total revenue divided by the total number of units produced.
D) Total revenue is at its maximum when marginal revenue is zero.

Question

Quizplus · Accepted Answer

Marginal revenue (MR) is the additional revenue that a firm receives from selling one more unit of a good or service. Total revenue (TR) is the total income a firm receives from selling its goods or services. The relationship between MR and TR is such that when MR is positive, TR increases with each additional unit sold. When MR is zero, it means that selling an additional unit does not increase TR anymore, indicating that TR is at its maximum. Hence, option D is correct.

Which of the Following Is True for Marginal Revenue and Total