Answer :
A purely competitive firm currently producing 35 units of output earns marginal revenues of $40 from each extra unit of output it sells. If it sells 40 units, then its total revenues would be $1600
Total revenue, additionally known as gross revenue, is your general sales from ordinary (MRR) and non-habitual sales streams. In other phrases, it's the overall amount of earnings your enterprise brings in from selling your merchandise/services.
To calculate the total revenue follow the following steps:
Given: Output = 35 units
Marginal Revenue = $40 from each extra unit of output it sells
It sells 40 units,
Then, Marginal Revenue = $40 (because marginal revenue is constant for all levels of output)
Therefore Total revenue = 40 * 40
Total revenue = $1600
Marginal revenue is the boom in sales that outcomes from the sale of one extra unit of output. while marginal sales can remain constant over a sure stage of output, it follows from the regulation of diminishing returns and will subsequently sluggish down as the output level will increase.
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