Assume a non-price discriminating monopolist can sell 45 units of a good for $ 1.50 each and can sell 46 units of that good for $ 1.45 each.The marginal revenue of the 46th unit is:
A)-$ .08
B)$ .08.
C)$ .80.
D)-$ .80

Question

Quizplus · Accepted Answer

The marginal revenue of the 46th unit is calculated by the change in total revenue when selling one more unit. Selling 45 units at $1.50 each gives a total revenue of $67.50. Selling 46 units at $1.45 each gives a total revenue of $66.70. The marginal revenue is $66.70 - $67.50 = -$0.80.

Assume a Non-Price Discriminating Monopolist Can Sell 45 Units of a Good