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Economic Definition of monopoly average revenue. Defined.

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Term monopoly average revenue Definition: The per unit revenue received by a monopoly firm for selling its output. It is found by dividing total revenue by the quantity of output. Average revenue is also the price received by a monopoly for selling its output. Because average revenue is price and because the demand for a monopoly's output is the market demand for the good, the average revenue received by a monopoly depends on the quantity sold. A monopoly firm sees average revenue decrease as the quantity of output sold increases. For relatively small quantities, average revenue is relatively high. For relatively larger quantities, average revenue is less.

 

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