$$\begin{array} { c r }
\text { Output } & \text { Price } \
1 & \$ 20 \
2 & 18 \
3 & 16 \
4 & 14 \
5 & 12
\end{array}$$
-The marginal revenue that would be derived from producing a fourth unit of output is
A)$20.
B)$16.
C)$12.
D)$8.
E)$4.

Question

$$\begin{array} { c r } 
\text { Output } & \text { Price } \
1 & \$ 20 \
2 & 18 \
3 & 16 \
4 & 14 \
5 & 12
\end{array}$$
-The marginal revenue that would be derived from producing a fourth unit of output is
A)$20.
B)$16.
C)$12.
D)$8.
E)$4.

Quizplus · Accepted Answer

Marginal revenue is the additional revenue that is gained from selling one more unit of a product. To calculate the marginal revenue of producing the fourth unit, subtract the total revenue of selling 3 units from the total revenue of selling 4 units. The total revenue from selling 3 units is $3 \times \$16 = \$48$, and the total revenue from selling 4 units is $4 \times \$14 = \$56$. The marginal revenue of the fourth unit is therefore \$56 - \$48 = \$8.

Output Price 1$20218316414512\begin{array} { c r } \text { Output } & \text { Price } \\1 & \$ 20 \\2 & 18 \\3 & 16 \\4 & 14 \\5 & 12\end{array} Output 12345​ Price $2018161412​

$\begin{array} { c r } \text { Output } & \text { Price } \\1 & \$ 20 \\2 & 18 \\3 & 16 \\4 & 14 \\5 & 12\end{array}$