Marginal Revenue Calculator
MR is the increase in revenue that arrives with selling one additional unit. Whenever you raise the unit’s quantity sold by one, the overall variation between the before and after revenue will equal your Marginal Revenue (MR).
Marginal Revenue Calculator Formula
MR = ∆T/∆Q
- "MR" is Marginal Revenue,
- "∆T" is the change in absolute revenue
- "∆Q" is the change in quantity.
For a better understanding, let’s take a real-life example. Suppose you’re manufacturing a thousand (2,000) footballs in a month, and after selling them, you will get $30,000 in revenue a month – $30,000 / $2,000 = $15 per football on average.
Near premier league’s month, you produced 100 units (Footballs) in addition. And you get total revenue of $50,000 that month.
As we know, Marginal Revenue (MR) is the change in absolute revenue (∆TR)
which is $20,000 ($50,000 - $30,000), divided by the change in quantity (100 units). So, after merely applying the formula, you will get $200 as your marginal revenue for that month.
MR = ∆T/∆Q
MR = $50000 - $30000 / 2100 - 2000
MR = 12000 / 100
MR = 120 Units
By using the Marginal Revenue Calculator, you can easily find the absolute answer without doing complex calculations. Just put the value of change in revenue and growth in quantity, the answer will be displayed to you!