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Production and cost — Economics STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceEconomicsProduction and cost3 Marks
Question
Explain the relationship between Marginal Revenue (MR) and Average Revenue (AR).
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Answer

Relationship between Marginal Revenue and Average Revenue is stated below:
  1. When AR is constant, MR = AR.
  2. When AR is diminishing, AR > MR.
  3. When AR is rising, AR < MR.
  4. MR can be negative, but not AR.

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