Use the following to answer question:
-(Table: Demand for Lenny's Coffee)Use Table: Demand for Lenny's Coffee.Lenny's Café is the only source of coffee for hundreds of miles in any direction.If Lenny increases the quantity sold from 5 cups to 6,his marginal revenue will be:
A)$4.
B)$24.
C)-$1.
D)$5.

Question

Use the following to answer question: 
-(Table: Demand for Lenny's Coffee)Use Table: Demand for Lenny's Coffee.Lenny's Café is the only source of coffee for hundreds of miles in any direction.If Lenny increases the quantity sold from 5 cups to 6,his marginal revenue will be:
A)$4. 
B)$24. 
C)-$1. 
D)$5.

Quizplus · Accepted Answer

According to the table, when Lenny increases the quantity sold from 5 cups to 6 cups, the total revenue decreases from $30 to $29. Therefore, the marginal revenue is negative ($29-$30=-$1). Hence, Lenny should not increase the quantity sold from 5 cups to 6 cups as it will decrease his total revenue.

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