Download App

The theory of the firm under perfect competition — Economics STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceEconomicsThe theory of the firm under perfect competition3 Marks
Question
Define Average Revenue. Show that Average Revenue and Price are same.
✓

Answer

Average revenue refers to revenue per unit of commodity. Total Revenue Average Revenue $=\frac{\text{Total Revenue}}{\text{Units of output sold}}$ Total Revenue = Price × Units of output sold,This show that AR and price are always same:
Price (₹) Units sold TR AR
10 1 10 10
10 2 20 10
10 3 30 10
10 4 40 10
From the given schedule, we can say that AR is always equal to price.

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 The theory of the firm under perfect competition→The theory of the firm under perfect competition — all question types→Economics STD 11 Commerce question papers→CBSE Board STD 11 Commerce question papers→CBSE Board question paper generator→

Similar questions

Why does the difference between ATC and AVC decrease with the increase in the level of output? Can these two be equal at some level of output? Explain.
OR
Why does the difference between ATC and AVC decreases with the increase in the level of output? Explain.
→
Distinguish between ‘increase in demand’ and ‘increase in quantity demanded’ of a commodity.
→
Giving reason comment on the shape of Production Possibilities curve based on the following schedule:
Good X(units) Good Y(units)
0 8
1 6
2 4
3 2
4 0
→
A consumer buys 27 units of a good at a price of ₹ 10 per unit. When the price falls to ₹ 9 per unit, the demand rises to 30 units. What can you say about price elasticity of demand of the good through the ‘expenditure approach’?
→
List the three different ways in which oligopoly firms may behave.
→
What do you mean by price floor?
→
Explain how rise in income of a consumer affects the demand of a good. Give example.
OR
Explain the effect of rise in a income of a consumer on his demand for a good. Use diagram.

OR
Explain the effects of increase in the income of the buyer of the good $'X'$ on the demand of $X.$ Use diagram.
→
Draw Total Variable Cost, Total Cost, and Total Fixed Cost curves in a single diagram.
→
When price of a good is ₹ 7 per unit a consumer buys 12 units. When price falls to ₹ 6 per unit he spends ₹ 72 on the good. Calculate price elasticity of demand by using the percentage method. Comment on the likely shape of demand curve based on this measure of elasticity.
→
When price of a good falls by $10\%$, its quantity demanded rises from $40$ units to $50$ units? Calculate Price Elasticity of Demand by percentage method.
→