Consider the following table showing the various revenue concepts for DairyTreat Inc.

| November 24, 2016

Consider the following table showing the various revenue concepts for DairyTreat Inc., a perfectly competitive firm that sells milk by the litre. Suppose the firm faces a constant marker price of $2 per litre.

Price (p) Quantity Total Revenue (TR) Average Revenue (AR) Marginal Revenue (MR)
$2 150
2 175
2 200
2 225
2 250

a. Compute total revenue for reach level of output. Fill in the table.
b. Compute average and marginal revenue for each level of output. Fill in the table. (Remember to compute marginal revenue between successful levels of output.)
c. Explain why for a perfectly competitive firm, AR = MR = p.
d. Plot the TR, MR, and AR curves on a scale diagram. What is the slope of the TR curve?

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