Scenario 1-2
Suppose a cigar manufacturer currently sells 1,500 cigars per week and makes a profit of $3,000 per week.The plant foreman observes,"Although the last 500 cigars we produced and sold increased our revenue by $7,500 and our costs by $7,000,we are only making an overall profit of $3,000 per week so I think we need to cut back on production.
-Refer to Scenario 1-2.Using marginal analysis terminology,what is another economic term for the incremental revenue received from the sale of the last 500 cigars?

Question

Quizplus · Accepted Answer

The incremental revenue received from the sale of the last 500 cigars is known as marginal revenue.

Scenario 1-2 Suppose a Cigar Manufacturer Currently Sells 1,500 Cigars Per Week