Page 236 - DECO401_MICROECONOMIC_THEORY_ENGLISH

Unit-11: Concepts of Revenue

Notes
Fig. 11.7

Y

(A)
Revenue A T

B
C
P M
E TR
F
O X
Q Output

Y
(B)

+ve
Revenue +ve

Zero AR
O X
–ve
MR
Quantity

4. When average revenue curve and marginal revenue curve are convex: The average revenue curve and
the marginal revenue curve represented in Fig. 11.8 are convex. In this stage, the marginal revenue curve
intersects at some point to the vertical line put from any point in axis OY. It means that the marginal
revenue curve is greater than average revenue curve in axis OY, i.e. AB < BC (AB is less than BC).

Fig. 11.8

Y

Revenue A B C AR

MR

O X
Output

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