Definition - Marginal revenue is the rise in income that occurs from the sale of one extra unit of product. While marginal revenue can continue constantly over a particular level of output, it follows the law of diminishing returns and will ultimately decrease as the output level increases. Ideally, ambitious firms proceed to produce output until marginal revenue approaches marginal cost.
The marginal revenue is the change or the additional unit from the sale of the one extra unit of product in the market. It is the change in the revenue pattern after selling one extra unit of product.
Further Explanation:
Marginal revenue:
The marginal revenue (MR) is a revenue generated from one extra unit of sales. It is in microeconomics and to calculate the marginal revenue. The marginal revenue is computed by dividing the change in total revenue by the change in quantity sold, this is how the marginal revenue is calculated.
Therefore, the marginal revenue is revenue from the change of selling one more unit of product.
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Answer Details:
Grade: High school
Chapter: Marginal revenue
Subject: Economics
Keywords: What is the best definition of marginal revenue, the marginal revenue is the change or the additional unit from the sale of the one extra unit of product in the market. It is the change in the revenue pattern after selling one extra unit of product, the marginal revenue is computed by dividing the change in total revenue by the change in quantity sold, this is how the marginal revenue is calculated.
