Table 9.2
$\begin{array}{ll}
\text { Price }(\$) & \text { Quantity Demanded } \
\hline 50 & 2 \
40 & 3 \
30 & 4 \
20 & 5 \
10 & 6
\end{array}$
-Refer to Table 9.2.Marginal revenue from the third unit of output is _____
A)$20.
B)$120.
C)$100.
D)$40.
E)$0.

Question

Table 9.2
 $\begin{array}{ll}
\text { Price }(\$) & \text { Quantity Demanded } \
\hline 50 & 2 \
40 & 3 \
30 & 4 \
20 & 5 \
10 & 6
\end{array}$
-Refer to Table 9.2.Marginal revenue from the third unit of output is _____
A)$20.
B)$120.
C)$100.
D)$40.
E)$0.

Quizplus · Accepted Answer

Marginal revenue is the additional revenue that a firm receives from selling one more unit of a good or service. From the table, when the price drops from $40 to $30, the quantity demanded increases from 3 to 4 units. This means the third unit of output (going from 3 to 4 units) generates additional revenue. The total revenue at $40 (for 3 units) is $120, and at $30 (for 4 units), it is $120. The marginal revenue for the third unit is thus $30 (the price at which the fourth unit is sold), not the difference in total revenue, which remains the same due to the linear demand curve presented. The correct interpretation for calculating marginal revenue in this context involves recognizing the price at which the additional unit is sold, which is $30, not the change in total revenue. However, the question asks specifically about the third unit, not the fourth, indicating a need for clarification in the explanation. The marginal revenue for selling the third unit, when moving from selling 2 units to 3 units, actually involves an increase in revenue from $80 (2 units at $40 each) to $120 (3 units at $40 each), which is a $40 increase for that third unit, making the correct answer based on the provided options and the clarification needed in the question's context.

Table 92 Price ($) Quantity Demanded 502403304205106\begin{array}{ll}\text { Price }(\$) & \text { Quantity Demanded } \\\hline 50 & 2 \\40 & 3 \\30 & 4 \\20 & 5 \\10 & 6\end{array} Price ($)5040302010​ Quantity Demanded 23456​​

Table 92 $\begin{array}{ll}\text { Price }(\$) & \text { Quantity Demanded } \\\hline 50 & 2 \\40 & 3 \\30 & 4 \\20 & 5 \\10 & 6\end{array}$