00:01
So average revenue is your total revenue over the number that you're selling.
00:16
So let's call that n.
00:18
And we'll call average revenue, we'll call that ar.
00:22
And this then we'll call, if we call total revenue tr, this is going to be tr over n.
00:29
Now our marginal revenue, which we'll call mr.
00:41
We're told that our marginal revenue is greater than our average revenue, so that's greater than ar.
00:48
So we can write that marginal revenue is equal to ar plus some constant c, for c greater than zero.
00:58
And the marginal revenue tells us the additional revenue from adding one unit.
01:04
So if we add one unit to n, we get n plus one.
01:14
If we add this last unit, our total revenue becomes tr star equal to tr plus one additional, or plus the marginal revenue that we added...