Suppose a firm can sell one unit of product for $50, two units for $45 each,...
Suppose a firm can sell one unit of product for $50, two units
for $45 each, three units for $40 each, or four units for
$35 each. When the firm sells four units, marginal revenues is
equal to
A. $5
B. $20
C. $25
D. $30
E. $35
Homework Answers
Ans. Total revenue for 3 units sold = 3 * $40 = $120
Total revenue for 4 units sold = 4 * $35 = $140
Marginal revenue for the firm selling 4 units = Total revenue for 4 units - Total revenue for 3 units
= $140 - $120 = $20
B) $20
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