Podcast
Questions and Answers
What are the values of Q when total revenue (TR) is zero?
What are the values of Q when total revenue (TR) is zero?
What is the maximum value of total revenue (TR) and at which quantity (Q) does it occur?
What is the maximum value of total revenue (TR) and at which quantity (Q) does it occur?
What is the equation for total revenue (TR) given the demand function?
What is the equation for total revenue (TR) given the demand function?
What is the x-coordinate of the vertex of the total revenue function?
What is the x-coordinate of the vertex of the total revenue function?
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Which of the following accurately describes the graph of the total revenue function?
Which of the following accurately describes the graph of the total revenue function?
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Study Notes
Demand Function and Total Revenue (TR)
- Demand function: p = 100 – 2Q
- Total Revenue (TR) is calculated as TR = p × Q
TR = 0
- To find when TR = 0, substitute the demand function into the TR equation: 100 – 2Q = 0 Solving for Q: Q = 50
Maximum TR
- To find the maximum value of TR, the quadratic equation for TR (100Q – 2Q²) needs to be in its vertex form.
- TR = 100Q – 2Q²
- The vertex of the equation occurs at an output (Q) of: Q = 25
- Substitute Q = 25 into the TR equation to find the max value of TR: TR = 100(25) – 2(25)² TR = 2500 – 1250 TR = 1250
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Description
Test your understanding of the demand function and total revenue concepts. This quiz covers calculating total revenue, determining when it equals zero, and finding the maximum total revenue using a quadratic equation. Ideal for students studying microeconomics.
