Download App

Production and cost — Economics STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceEconomicsProduction and cost3 Marks
Question
'Average Revenue curve represents Law of Demand'. Discuss.
✓

Answer

Average Revenue is determined by dividing Total Revenue by the quantity sold which indicates price of the commodity. Hence, Average Revenue curve shows the relationship between price of a commodity and quantity demanded. It is downward sloping curve because to increase its sales, firms have to lower their prices. So, it possesses all the characteristics of the demand curve. Therefore, we can say that Average Revenue curve represents Law of Demand.

Need a full question paper?

Generate a complete, print-ready paper with questions like this in minutes — across 16+ boards, with answer keys.

Start Generating Free

Explore more

More "3 Marks Question" from Production and cost→Production and cost — all question types→Economics STD 11 Commerce question papers→CBSE Board STD 11 Commerce question papers→CBSE Board question paper generator→

Similar questions

‘Change in demand’ and ‘change in quantity demanded’.
→
Why is the average revenue curve of a monopolist less elastic than the average revenue curve of a firm under monopolistic competition? Explain.
→
Complete the following table:
Units of labour
TP
$\text{MP}_\text{L}$
$\text{AP}_\text{L}$
1.
20
-
-
2.
-
22
-
3.
-
-
22
→
The Price Elasticity of Supply of a commodity is $2$. When its price falls from $10$ to $8$ per unit, its quantity supplied falls by $500$ units. Calculate the quantity supplied at the reduced price.
→
If a consumer has monotonic preferences, can she be indifferent between the bundles (10, 8) and (8, 6)?
→
Show the determination of equilibrium price with the help of schedule.
→
A consumer has ₹ 40 and both goods X and Y are priced at ₹ 20 and are available in integer units. (a) Give the bundles that this consumer can afford (b) give the bundles that cost exactly ₹ 40.
→
Find out the median of the data given below by arranging them in ascending order
X160150152161156
Frequency58637
→
What is price discrimination? Give two examples of the power of a monopolist to practice price discrimination.
→
Why are the firms said to be interdependent in an oligopoly market? Explain.
→