A monopolistic firm has a sales schedule such that it can sell 10 prefabricated garages per week at $10,000 each, but if it restricts its output to 9 per week it can sell these at $11,000 each. The marginal revenue of the 10th unit of sales per week is
A)$-1,000.
B)$9,000.
C)$1,000.
D)$10,000.

Question

Quizplus · Accepted Answer

Marginal revenue is the change in total revenue resulting from the sale of one additional unit of output. In this case, the marginal revenue of the 10th unit of sales per week is $11,000 - $10,000 = $1,000.

A Monopolistic Firm Has a Sales Schedule Such That It