Wendy sells ice-making machines.She can sell six per week at a price of $2,000 per machine.If she charges $2,100 per machine,she will sell only five per week.The marginal benefit of selling the sixth ice-making machine is:

Question

Quizplus · Accepted Answer

The marginal benefit is the additional benefit of selling one more unit. In this case, the marginal benefit of selling the sixth ice-making machine is the difference in revenue between selling five and six machines.

If Wendy sells six machines per week at $2,000 each, her total revenue is 6 x $2,000 = $12,000.

If she sells only five machines per week at $2,100 each, her total revenue is 5 x $2,100 = $10,500.

The difference in revenue between the two scenarios is $1,500, which is the marginal benefit of selling the sixth ice-making machine.

Wendy Sells Ice-Making Machines