Calculate the total revenue if the firm produces 20 versus 19 units. Then, calculate the marginal revenue of the 20th unit produced.

Answers

Answer 1

The marginal revenue of the 20th unit produced is $33.

What is marginal revenue?

Marginal revenue is the money a company makes for each additional sale. In other words, it determines how much money a company makes from selling another product. For example, if a baker sells an additional loaf of bread for $2, his marginal income is also $2 for him.

When, Q = 9 units and P = $123

Total revenue = P × Q

= 123 × 9

= $1107

When, Q = 10 units and P = $120

Total revenue = P × Q

= 120 × 10

= $1200

Marginal revenue of the 10th unit produced:

= Total revenue of 10 unit - Total revenue of 9 unit

= $1200 - $1107

= $93

When, Q = 19 units and P = $93

Total revenue = P × Q

= 93 × 19

= $1767

When, Q = 20 units and P = $90

Total revenue = P × Q

= 90 × 20

= $1800

Marginal revenue of 20th unit produced:

= Total revenue of 20 unit - Total revenue of 19 unit

= $1800 - $1767

= $33

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Calculate The Total Revenue If The Firm Produces 20 Versus 19 Units. Then, Calculate The Marginal Revenue

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