$\begin{array}{c}
\begin{array}{c}
\underline{\text {Quantity}}\
1 \
2 \
3 \
4 \
5
\end{array}
\begin{array}{c}
\underline{\text { Price }} \
\$ 500 \
450 \
400 \
350 \
300
\end{array}
\begin{array}{c}
\underline{\text { Total cost }} \
\$ 400 \
650 \
950 \
1,300 \
1,700
\end{array}
\end{array}$

$\text {Table 24.1}$
$\text {Hypothetical Monopoly Costs and Revenue}$
In Table 24.1, according to the profit maximization rule, at the profit-maximizing level of output, marginal revenue is
A)$300.
B)$200.
C)$100.
D)$250.

Question

$\begin{array}{c}
\begin{array}{c}
\underline{\text {Quantity}}\
1 \
2 \
3 \
4 \
5
\end{array}
\begin{array}{c}
\underline{\text { Price }} \
\$ 500 \
450 \
400 \
350 \
300
\end{array}
\begin{array}{c}
\underline{\text { Total cost }} \
 \$ 400 \
650 \
950 \
1,300 \
1,700
\end{array} 
\end{array}$

$\text {Table 24.1}$
$\text {Hypothetical Monopoly Costs and Revenue}$
 In Table 24.1, according to the profit maximization rule, at the profit-maximizing level of output, marginal revenue is
A)$300.
B)$200.
C)$100.
D)$250.

Quizplus · Accepted Answer

At the profit-maximizing level of output, marginal revenue equals marginal cost. The marginal cost can be calculated from the change in total cost as output increases. From quantity 4 to 5, the total cost increases by $400 (from $1,300 to $1,700), and the price at quantity 5 is $300, indicating the marginal revenue is $300.

Table 24.1\text {Table 24.1}Table 24.1 Hypothetical Monopoly Costs and Revenue\text {Hypothetical Monopoly Costs and Revenue}Hypothetical Monopoly Costs and Revenue

$\text {Table 24.1}$ $\text {Hypothetical Monopoly Costs and Revenue}$