A single-price monopoly can sell 1 unit for $9.00.To sell 2 units,the price must be $8.50 per unit.The marginal revenue from selling the second unit is
A) $17.50.
B) $17.00.
C) $8.50.
D) $8.00.
E) $9.00

Question

Quizplus · Accepted Answer

The marginal revenue from selling the second unit is calculated by taking the total revenue from selling two units minus the total revenue from selling one unit, then dividing by the change in quantity sold. Selling two units at $8.50 each gives $17.00 in total revenue. Selling one unit gives $9.00 in total revenue. The change in total revenue is $17.00 - $9.00 = $8.00. This $8.00 is the marginal revenue from selling the second unit.

A Single-Price Monopoly Can Sell 1 Unit for $9