Final answer:
The average revenue per haircut is $8, calculated by dividing the total revenue generated per day from haircuts ($160) by the number of haircuts provided in a day (20).
Step-by-step explanation:
The student is asking how to calculate the average revenue per haircut for the campus barber.
In a competitive market, the campus barber charges $8 for a haircut and services 20 customers per day, for a total of 3 days a week.
To calculate the average revenue per haircut, you take the total revenue divided by the quantity of haircuts given. The formula for average revenue (AR) is AR = Total Revenue (TR) / Quantity of haircuts (Q).
Here, the total revenue is calculated by multiplying the price per haircut ($8) by the number of haircuts given in a day (20), and then by the number of days the barber shop is open (3).
Thus, we have TR = $8 * 20 * 3.
However, since we only need to find the average revenue per haircut for one day, we can simplify this to TR = $8 * 20 for one day. The quantity Q is 20 haircuts per day.
Thus, the average revenue per haircut is $8, as the total revenue from the haircuts each day is $160 ($8 * 20), and dividing this by the number of haircuts (20) gives us the average revenue per haircut, which is $8.