Suppose the accompanying figure illustrates the demand curve facing a monopolist.
At a price of $8 per unit, the total revenue for this monopolist is ________ per day, and the marginal revenue earned from the last unit sold is ________.
A)$8; $8
B)$3,200; $8
C)$3,200; $4
D)$3,200; $0

Question

Suppose the accompanying figure illustrates the demand curve facing a monopolist.  
 At a price of $8 per unit, the total revenue for this monopolist is ________ per day, and the marginal revenue earned from the last unit sold is ________.
A)$8; $8 
B)$3,200; $8 
C)$3,200; $4 
D)$3,200; $0

Quizplus · Accepted Answer

At $8 the firm will sell 400 units for total revenue of $3,200. For any straight-line demand curve, the associated marginal revenue curve has a horizontal intercept that is half the horizontal intercept of the demand curve. Thus, the marginal revenue of the 400ᵗʰ unit is $0.

Suppose the Accompanying Figure Illustrates the Demand Curve Facing a Monopolist