The following table shows the units of output sold at different price levels by Gizmo's Inc.Table 11.1

-According to Table 11.1, at what level of output is marginal revenue equal to $14?
A)1
B)2
C)3
D)4

Question

The following table shows the units of output sold at different price levels by Gizmo's Inc.Table 11.1
 
-According to Table 11.1, at what level of output is marginal revenue equal to $14?
A)1 
B)2 
C)3 
D)4

Quizplus · Accepted Answer

Marginal revenue is the change in total revenue associated with producing one additional unit of output. From the table, we can see that when the output level is 2 units, the total revenue is $46, and when 3 units are produced, the total revenue is $60. Therefore, the marginal revenue of the third unit is $14 ($60 - $46 = $14). Hence, the level of output at which marginal revenue is equal to $14 is 3.

The Following Table Shows the Units of Output Sold at Different