Figure 7.1
-Figure 7.1 shows a monopolist's demand curve. If the monopolist increases output from two to three units, what is its marginal revenue?
A) $3
B) $5
C) $12
D) $15

Question

Figure 7.1
-Figure 7.1 shows a monopolist's demand curve. If the monopolist increases output from two to three units, what is its marginal revenue?
A) $3 
B) $5 
C) $12 
D) $15

Quizplus · Accepted Answer

Marginal revenue is the change in total revenue from selling one more unit. If the price falls from $15 to $12 when output increases from 2 to 3 units, the total revenue increases by $3 (from $30 to $33), making the marginal revenue $3.

Figure 7.1 -Figure 7.1 Shows a Monopolist's Demand Curve. If the Monopolist