Table 14-6
A monopolist faces the following demand curve:

-Refer to Table 14-6.What is the marginal revenue from the sale of the 3rd unit?
A) $-3
B) $3
C) $9
D) $24

Question

Table 14-6
A monopolist faces the following demand curve:
 
-Refer to Table 14-6.What is the marginal revenue from the sale of the 3rd unit?
A) $-3 
B) $3 
C) $9 
D) $24

Quizplus · Accepted Answer

To calculate marginal revenue, we need to look at the change in total revenue from selling the third unit. When the firm sells two units, their total revenue is $36 ($18 per unit). When they sell three units, their total revenue is $45 ($15 per unit). The change in total revenue from selling the third unit is $9. Therefore, the marginal revenue from selling the third unit is $9 divided by the number of units sold ($3).

Table 14-6 A Monopolist Faces the Following Demand Curve