Table 15-18
A monopolist faces the following demand curve: Suppose marginal cost is constant at $8 per unit.
-Refer to Table 15-18. The monopolist's marginal revenue from selling the second unit of output is
A)$8.
B)$14.
C)$16.
D)$24.

Question

Table 15-18
A monopolist faces the following demand curve:  Suppose marginal cost is constant at $8 per unit.
-Refer to Table 15-18. The monopolist's marginal revenue from selling the second unit of output is
A)$8. 
B)$14. 
C)$16. 
D)$24.

Quizplus · Accepted Answer

To find marginal revenue, we take the derivative of total revenue with respect to quantity. Total revenue is equal to price times quantity, which in this case is (20-1.5Q)Q. 
Taking the derivative: 
TR = (20-1.5Q)Q
MR = dTR/dQ = 20 - 3Q
So the marginal revenue from selling the second unit of output is MR(2) = 20 - 3(2) = 14. Therefore, the correct answer is B.

Table 15-18 A Monopolist Faces the Following Demand Curve: Suppose Marginal