Marginal Revenue Calculator

Formula

The formula to calculate the Marginal Revenue (MR) is:

\[ MR = \frac{CTR}{CIQ} \]

Where:

$ MR $ is the marginal revenue
$ CTR $ is the change in total revenue ($)
$ CIQ $ is the change in quantity

What is Marginal Revenue?

Marginal revenue is the per-unit value increase from selling an additional unit in the business. In other words, if your revenue increases and your number of units sold also increases, then the marginal revenue will be the per-unit increase. This concept is crucial in understanding how changes in sales volume affect overall revenue.

Example Calculation

Let's assume the following values:

Change in Total Revenue (CTR) = $1,000
Change in Quantity (CIQ) = 50

Using the formula to calculate the Marginal Revenue:

\[ MR = \frac{1000}{50} = 20 \]

The Marginal Revenue is $20 per unit.