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# MR and TR Computation using a demand curve equation

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Can you assist me with the following problem. Thank you.

If we have a demand curve which can be described by Pd= 72.33-1.76Q, and we have a starting price of \$50, what happens to TR when the price falls to \$40? Find whether MR is positive or negative and fully explain why. Now, for the same demand curve, what happens to MR when the price falls from \$20 to \$10? Is this consistent with what happened in the first instance, or not? Show this in Excel by graphing a TR curve.

##### Solution Summary

The solution computes for the Marginal and Total Revenue using a demand curve equation. It provides both a guide to the calculations and a sample computation in Excel.

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Guide computation:

Demand curve which can be described by Pd= 72.33-1.76Q

0 = 72.33-1.76Q

1.76Q = 72.33
Q = 72.33 / 1.76
Q = 41.09659

at a starting price of \$50,
TR = Price x quantity
TR= 50 x ...

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