When marginal revenue is zero,total revenue:
A) will increase when price increases.
B) is maximized.
C) will decrease when price decreases.
D) will decrease as quantity decreases.

Question

Quizplus · Accepted Answer

Marginal revenue is the additional revenue earned by selling an additional unit of a good or service. When marginal revenue reaches zero, total revenue is maximized. This means that any further increase in production would lead to a decrease in total revenue. Therefore, the best choice is B.

When Marginal Revenue Is Zero,total Revenue