Answer :

Marginal revenue is the change in revenue with every additional quantity of output sold. It can be calculated with help of following formula

MR = TRn+1 - TRn


MR - Marginal Revenue

TRn+1 - Total revenue on sale of (n+1) quantity of output

TRn - Total revenue on sale of (n) quantity of output

In case of a price taking firm the market price is equal to marginal revenue. Therefore, in perfectly competitive market -

P = AR= MR

With help of following table we can understand this

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