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An Imperfectly Competitive Firm Produces Two Products (A and B)

Question 3

Multiple Choice

An imperfectly competitive firm produces two products (A and B) with interrelated demand functions. If the firm increases the number of units of A sold from 150 to 151, total revenue from the sale of A will increase from $1,500 to $1,505. Taking into account the interdependence between A and B, the marginal revenue from the sale of one additional unit of A must be


A) $5.
B) greater than $5.
C) less than $5.
D) This question cannot be answered without additional information.

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