3.2.2 Revenues

• What is total revenue defined as?

  Money from selling products
• Total revenue is calculated using the formula: Price × Quantity
• Average revenue is calculated by dividing total revenue by quantity sold.

  True
• What two variables are multiplied to calculate total revenue?

  Price and quantity
• The law of demand states that there is an inverse relationship between price and quantity demanded.


  True
• What does the law of demand describe?

  Inverse price-quantity relationship
• What is average revenue defined as?

  Total revenue per unit
• The formula for total revenue is: Total Revenue = Price × Quantity
• Average revenue is the total revenue divided by the number of units sold.


  True
• If selling one more unit increases total revenue by $8, the marginal revenue is $8.


  True
• Total revenue is calculated by multiplying the price per unit by the quantity of units sold.


  True
• The law of demand states that as price increases, quantity demanded decreases.


  True
• Higher income can shift the demand curve to the right.


  True
• If a company sells 50 units at $10 each, the total revenue is $500.


  True
• If selling one more unit increases total revenue by $8, the marginal revenue is $8.


  True
• If total revenue is $5,000 and 200 units are sold, the average revenue is $25.

  True
• If total revenue increases from $1,000 to $1,008 when production increases by one unit, the marginal revenue is $8.


  True
• A rational business produces where marginal revenue equals marginal cost.


  True
• The law of demand states that as the price of a good increases, the quantity demanded decreases.

  True
• If a company sells 50 units at $10 each, the total revenue is $500.


  True
• There is an inverse relationship between price and quantity demanded.

  True
• As price increases, quantity demanded decreases
• If a company sells 50 units at $10 each, the total revenue is $500.

  True
• Marginal revenue is calculated by dividing the change in total revenue by the change in quantity
• If a company sells 200 units and generates total revenue of $5,000, the average revenue is $25 per unit.

  True
• The average revenue curve matches the shape of the demand curve.
• The law of demand states that as the price of a good increases, the quantity demanded also increases.

  False
• How does marginal revenue differ from average revenue?

  Additional revenue per unit
• Marginal revenue is calculated by dividing the change in total revenue by the change in quantity
• Match the revenue concept with its definition:

  Total Revenue ↔️ Money from selling products

  Average Revenue ↔️ Revenue per unit

  Marginal Revenue ↔️ Additional revenue per unit
• Arrange the factors that can shift the demand curve in economics:

  1️⃣ Income

  2️⃣ Prices of related goods

  3️⃣ Consumer tastes and preferences
• Total revenue is calculated by multiplying the price per unit by the quantity
• The law of demand explains why demand increases as prices fall.


  True
• What is marginal revenue the result of selling?

  One more unit
• Marginal revenue is calculated as the change in total revenue divided by the change in quantity
• Match the concept with its definition:

  Average Revenue (AR) ↔️ Total revenue per unit

  Marginal Revenue (MR) ↔️ Additional revenue from one more unit
• The formula for total revenue is Price x Quantity
• The relationship between price and quantity demanded is an inverse relationship.
• The formula for total revenue is Total Revenue = Price x Quantity
• Average revenue is calculated as Total Revenue divided by Quantity