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Enter the revenue and quantity of the products in the tool, and the calculator will compute the marginal revenue.
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Use this calculator to determine the additional revenue generated from producing one more unit of a product or service. Marginal revenue (MR) is a key microeconomic concept that helps businesses optimize pricing and production for maximum profit.
MR = ΔTR / ΔQ
Where:
Initial revenue = $5,000, final revenue = $20,000, initial quantity = 25 units, final quantity = 100 units.
This shows that each additional unit sold generates $200 in revenue. Typically, MR decreases as output increases due to the inverse relationship between price and quantity.
MR measures revenue from an additional unit, while average revenue = total revenue ÷ total units sold.
It helps businesses determine the revenue contribution of extra units, guiding production and pricing decisions.
Positive MR indicates elastic demand; negative MR indicates inelastic demand. This informs pricing strategy decisions.
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