Your company sells 19 units at a price of $10 and must change price to $9.90 in order to sell 20 units. What is the marginal revenue of the twentieth unit?
A)-$.10
B)$8.00
C)$9.90
D)$198.00

Question

Quizplus · Accepted Answer

Marginal revenue is the change in total revenue divided by the change in quantity sold. In this case, the change in total revenue is $9.90 - $10 = -$0.10, and the change in quantity sold is 20 - 19 = 1. Therefore, the marginal revenue of the twentieth unit is -$0.10 / 1 = -$0.10.

Your Company Sells 19 Units at a Price of $10