If the XYZ Company can sell 4 units per week at $10 per unit and 5 units per week at $9 per unit, the marginal revenue of the fifth unit is $5.

Question

Quizplus · Accepted Answer

To calculate marginal revenue, we need to find the change in total revenue when the quantity sold increases by one unit.

At $10 per unit, the total revenue for selling 4 units per week is 4*$10=$40.

At $9 per unit, the total revenue for selling 5 units per week is 5*$9=$45.

So, the change in revenue from selling the 5th unit is $45-$40=$5. Therefore, the marginal revenue of the fifth unit is $5, making option A true.

If the XYZ Company Can Sell 4 Units Per Week