How are the total revenue of a firm, market price, and the quantity sold by the firm related to each other?
Total revenue is defined as the total sale proceeds of a producer by selling corresponding level of output therefore total revenue can be defined as the total sales proceed of the seller by selling the number of units at a given price.
In a perfectly competitive market the firm is a price taker so it can't influence the price hence it can change its total revenue by changing the quantity of output sold.
TR = P X Q
Where,
TR - Total Revenue
Q - Quantity of Output sold
P - Price
The total revenue curve is give below –
It touches the X-axis because the TR is zero if zero output is sold.