Marginal Revenue

This article talks about Marginal Revenue, which is the increase in revenue that results from the sale of one additional unit of output. It can remain constant over a certain level of output, it follows the law of diminishing returns and will eventually slow down, as the output level increases. It can also be described as the unit revenue the last item sold has generated for the firm. It is the price the firm gets on the additional unit sold, less the revenue lost by reducing the price on all other units that were sold prior to the decrease in price.