Total Revenue Equals What

Where p price of the product.

Total revenue equals what. If the store sells 20 pairs of shoes after the price increases to 25 then its total revenue equals 20 times 25 or 500. Revenue is the total amount of money a company brings in from selling its goods and services at a specific price. If average revenue and marginal revenue are parallel to horizontal axis then it means both ar and mr are equal to each other i e. If the hot dogs are sold at 4 00 each the total revenue would equal 40 10 x 40.

Marginal revenue is the change in total revenue over the change in output or. If a single output is priced at 5 and you produce 10 000 units the total revenue will be 50 000. Tr p x q tr q. And q quantity sold per period.

What is marginal revenue. If you sell 50 tennis rackets for 70 dollars each your total revenue for those sales is 3 500. Your total racket sales are 150 and your total revenues are 6 500. The formula for calculating total revenue can be written as.

For example if a store sells 30 pairs of shoes at 10 each then its revenue equals 30 times 10 or 300. Increased revenue doesn t necessarily mean you are making a profit or you have more money to spend on advertising or salary increases or to pay down debt or purchase new machinery. The starting point for any income statement is revenue that will eventually lead. In the same fashion average revenue and marginal revenue can also be calculated from total revenue.

Total revenue in economics refers to the total sales of a firm based on a given quantity of goods. The total revenue calculation is fairly simple. Total revenue price x number of units sold. Putting together the total cost portion of the equation is the most intensive aspect of the total cost and total revenue method.

It is the total income of a company and is calculated by multiplying the quantity of goods sold. When ar and mr are parallel to x axis. Total revenue equals the sale price of products multiplued by the total amount of units sold. It has been shown with the help of table 2 and diagram 2.

Total revenue multiples the price by the quantity.