If a firm can sell 15 units of output for $10 each or 14 units at $12 each,the additional revenue from selling the fifteenth unit is ________.

Question

Quizplus · Accepted Answer

To compare the two options, we need to calculate the total revenue from both scenarios.

Option 1: Sell 15 units at $10 each 
Total revenue = 15 x $10 = $150

Option 2: Sell 14 units at $12 each 
Total revenue = 14 x $12 = $168

The additional revenue from selling the fifteenth unit is the difference between the two total revenue figures.

Additional revenue = Total revenue from Option 2 - Total revenue from Option 1 
Additional revenue = $168 - $150 
Additional revenue = -$18

Since the additional revenue is negative, it means that selling the fifteenth unit would result in a decrease in revenue, in other words, it would result in a net loss of $18. Therefore, the best choice is C, as the additional revenue from selling the fifteenth unit is -$18.

If a Firm Can Sell 15 Units of Output for $10