The following table shows the quantity demanded of a good at various prices for a monopoly firm.
Table 11-1 $$\begin{array} { | c | c | }
\hline \text { Quantity } & \text { Price } \
\hline 1 & \$ 90 \
\hline 2 & \$ 80 \
\hline 3 & \$ 70 \
\hline 4 & \$ 60 \
\hline 5 & \$ 50 \
\hline 6 & \$ 40 \
\hline 7 & \$ 30 \
\hline 8 & \$ 20 \
\hline 9 & \$ 10 \
\hline
\end{array}$$
-Refer to Table 11-1.What is the marginal revenue when 3 units are sold?
A)$20
B)$30
C)$50
D)$70

Question

The following table shows the quantity demanded of a good at various prices for a monopoly firm.
Table 11-1 $$\begin{array} { | c | c | } 
\hline \text { Quantity } & \text { Price } \
\hline 1 & \$ 90 \
\hline 2 & \$ 80 \
\hline 3 & \$ 70 \
\hline 4 & \$ 60 \
\hline 5 & \$ 50 \
\hline 6 & \$ 40 \
\hline 7 & \$ 30 \
\hline 8 & \$ 20 \
\hline 9 & \$ 10 \
\hline
\end{array}$$
-Refer to Table 11-1.What is the marginal revenue when 3 units are sold?
A)$20
B)$30
C)$50
D)$70

Quizplus · Accepted Answer

Marginal revenue is the change in total revenue divided by the change in quantity. When 3 units are sold, total revenue is $210 (3 x $70). If one more unit is sold, total revenue increases to $260 (4 x $65). Therefore, marginal revenue is $50 ($260 - $210).

The Following Table Shows the Quantity Demanded of a Good