Wendell can sell five motor homes per week at a price of $22,000.If he lowers the price of motor homes to $20,000 per week he will sell six motor homes.What is the marginal revenue of the sixth motor home?
A)$10,000
B)$12,000
C)$20,000
D)$22,000

Question

Quizplus · Accepted Answer

The marginal revenue is the additional revenue from selling one more unit. At $22,000, Wendell sells 5 motor homes, totaling $110,000. At $20,000, he sells 6, totaling $120,000. The marginal revenue for the sixth motor home is $120,000 - $110,000 = $10,000.

Wendell Can Sell Five Motor Homes Per Week at a Price