REVENUE COST

There are three different types of revenue namely

TOTAL REVENUE (T.R):

This is the total amount of money, which a firm realizes from the sales of their products, i.e. T.R, = price x output. Note that total revenue rises with output and decreases as the output decreases.

AVERAGE REVENUE (A.R)

entails the revenue divided by the total number of output sold. It is calculated by dividing the total revenue by the output sold.

AR = TRTO.

MARGINAL REEVENUE (M.R)

This is the change in total revenue brought about by a unit change in the total output sold over a given period of time.

 

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