For which type of good would you expect consumers to spend more time on comparative shopping, or shopping for lower prices?
Problems
Given the following total revenue function:
TR = 9Q-Q2
a. Derive the total-revenue, average-revenue, and marginal-revenue schedules from Q = 0 to Q = 4 by 1s.
Average revenue (AR) = total revenue (TR) / Q
Marginal revenue (MR) = change in total revenue / change in Q
For example Q TR AR MR
2 14 7
3 18 6 4
b. On the same set of axes, plot the total-, average-, and marginal-revenue schedules of part (a).