A restaurant sells a large soft drink at a fixed price of $1.79.A term used by economists to describe the money received from the sale of an additional large soft drink is
A)marginal revenue.
B)gross earnings.
C)pure profit.
D)net benefit.

Question

Quizplus · Accepted Answer

Marginal revenue is the money earned from selling one additional unit of a product. In this case, the additional unit is a large soft drink. Therefore, the additional revenue earned from selling one more large soft drink is the marginal revenue. Choice B (gross earnings) refers to the total income earned by a business, not just the additional revenue from one more unit. Choice C (pure profit) refers to the amount of money earned after subtracting all expenses from total revenue. Choice D (net benefit) is a more general term that refers to any positive outcome or advantage gained from an action or decision, but it does not specifically apply to revenue from the sale of a product.

A Restaurant Sells a Large Soft Drink at a Fixed