A meatball sandwich vendor finds that when he charges a price of $6, he sells 100 meatball sandwiches. When he charges a price of $4, he sells 200 meatball sandwiches. The marginal revenue for each of the additional 100 meatball sandwiches he sells is
A) $6
B) $4
C) $3
D) $2
E) $1

Question

Quizplus · Accepted Answer

The marginal revenue is the change in total revenue divided by the change in quantity. The total revenue at $6 is $600 (6*100) and at $4 is $800 (4*200). The change in total revenue is $200 ($800-$600) and the change in quantity is 100 sandwiches, so the marginal revenue is $2 ($200/100).

A Meatball Sandwich Vendor Finds That When He Charges a Price