Q.From the following demand schedule of a monopolist, calculate TR, AR and MR. Price (₹) at Q = 1, 2, 3, 4, 5 is 20, 18, 16, 14, 12 respectively.

TR is price times quantity at each output level, AR is simply the price itself, and MR is the change in TR between successive units — all three are computed directly from the given demand schedule. …

Step 1 — Total Revenue ($TR = P \times Q$):

Step 2 — Average Revenue ($AR = TR/Q$, which always equals P by definition):

(Check: $AR = TR/Q$, e.g. at Q=3, $48/3=16$ ✓ — matches the given price, as it always must.)

Step 3 — Marginal Revenue ($MR_n = TR_n - TR_{n-1}$):

Dual-solve check: the schedule is close to a linear demand curve $P = 22 - 2Q$; for a linear demand curve, the associated MR line is $MR = 22 - 4Q$, i.e. MR falls at twice the rate of AR — a standard property. This is consistent with the direction of the schedule-based MR figures above, which are computed independently from the actual TR differences and are therefore the authoritative answer. …

A common error is calculating MR as $P_n - P_{n-1}$ (the change in price) instead of $TR_n - TR_{n-1}$ (the change in total revenue) — the two are not the same once quantity is also …