Julie plans to start a pet-sitting service. She surveyed her neighborhood to determine the demand for this service. Assume that each person surveyed demands only one hour of pet sitting services per period. Table 15-6 above shows a portion of her survey results.
-Refer to Table 15-6. Suppose Julie's marginal cost of providing this service is constant at $7 and she charges $7 per hour. What is her marginal revenue?

Question

Quizplus · Accepted Answer

Marginal revenue is the additional revenue that a producer receives from selling one more unit of a good or service. If Julie charges a constant price of $7 per hour for her service, her marginal revenue from each additional hour sold is also $7, regardless of how many hours she sells. This is because the additional income she makes for each extra hour of service provided is always $7, matching her constant price.

Julie Plans to Start a Pet-Sitting Service