To the right is a downward sloping demand curve D and the associated marginal revenue curve MR. At every level of output the MR < P because the price must be reduced for all units sold. Again, the marginal revenue is the price of the extra revenue sold - the reduced revenue from lowering the price of all units that would have been sold before the price decrease.
Suppose market demand shifts for some reason, what happens
to marginal revenue?
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