Definition – What is Total Revenue?
In microeconomics, total revenue is all the revenue that the company receives for the goods and services it sells.
It is the price that the firm sells items for times the number of items it sells.
Formula – How to Calculate Total Revenue
Total Revenue = Price x Quantity
- “Price” is the price each unit sells for.
- “Quantity” is the number of units sold.
Units are selling at $20 per unit and 400 sell.
Total Revenue = $20 x 400 = $8,000
Total revenue is $8,000.
Sources and resources
- Khan Academy – Total Revenue and Elasticity – Part of a larger course on microeconomics. This video overviews the concept of total revenue.
- Wikipedia – Total Revenue – Wikipedia’s page on total revenue and how it is used.
- Lumen – Reading: Elasticity and Total Revenue – Part of a larger course on microeconomics. This page describes total revenue in the context of elasticity.