If a firm sells 200 units of output at $15 per unit and 210 units of output when price is reduced to $14, its marginal revenue from selling the last unit is
A) $60.
B) $210.
C) $294.
D) -$60.

Question

Quizplus · Accepted Answer

Marginal revenue is the change in total revenue from selling one more unit. The total revenue at 200 units is $3000 (200*$15) and at 210 units is $2940 (210*$14). The change in revenue is $2940 - $3000 = -$60.

If a Firm Sells 200 Units of Output at $15