Table 15-4
A monopolist faces the following demand curve:

-Refer to Table 15-4. If the monopolist produces 5 units, what is its marginal revenue?

Question

Table 15-4
A monopolist faces the following demand curve:
 
-Refer to Table 15-4. If the monopolist produces 5 units, what is its marginal revenue?

Quizplus · Accepted Answer

To find the marginal revenue, we need to look at the change in total revenue when producing one additional unit. From the table, we can see that the total revenue for 5 units is $100 ($20 x 5). If we produce one more unit, the total revenue will increase to $115 ($23 x 5). Therefore, the marginal revenue for producing 5 units is the difference between the two, which is $15.

Table 15-4 A Monopolist Faces the Following Demand Curve