Suppose that a monopoly computer chip maker increases production from 10 microchips to 11 microchips.If the market price declines from $30 per unit to $29 per unit,marginal revenue for the eleventh unit is:
A)$1.
B)$9.
C)$19.
D)$29.

Question

Quizplus · Accepted Answer

Marginal revenue is the change in total revenue from selling one more unit. Initially, total revenue is 10 microchips * $30 = $300. After selling 11 microchips at $29, total revenue is 11 * $29 = $319. The marginal revenue for the eleventh unit is $319 - $300 = $19.

Suppose That a Monopoly Computer Chip Maker Increases Production from 10