General Relationship between AR and MR
The relationship between AR and MR depends on whether the price remains the same or falls with a rise in output. However, if nothing is mentioned about the nature of price with the rise in output, then the following general reflection exists between AR and MR:
1. AR increases when MR is higher than AR (When MR > AR, AR increases).
2. AR is maximum and constant when MR is equal to AR (When MR = AR, AR is maximum).
3. AR falls when MR is less than AR (When MR < AR, AR falls).
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