Final answer:
Total revenue, which is the total income from sales of goods or services, is calculated by multiplying the price by the quantity sold (Total Revenue = Price × Quantity).
Step-by-step explanation:
The formula for total revenue is calculated by taking the price of a product and multiplying it by the quantity of output sold. Mathematically, it is expressed as:
Total Revenue = Price × Quantity
Total revenue represents the income a firm earns from the sales of its goods or services. This calculation is crucial for businesses to understand their financial performance. For example, if a farmer sells packs of raspberries for $4 each, selling one pack yields $4 in total revenue, selling two packs yields $8, and so on. The total revenue increases with either an increase in quantity sold or an increase in price.