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Rate of Change, Marginal Cost & Revenue · Question 51 of 79

What is the firm's marginal revenue when it sells 20 units a week?

Question 51

EasyOriginal question

A firm finds that to sell xx units a week it must set the price at p=120−2xp = 120 - 2x rupees a unit.

What is the firm's marginal revenue when it sells 20 units a week?

Options for question 51

Show the answer and explanation
CorrectNot quiteAnswer A

Correct answer: A

Explanation

  1. R(x)=px=120x−2x2R(x) = px = 120x - 2x^{2}, so MR=120−4xMR = 120 - 4x.

  2. At x=20x = 20: 120−80=40120 - 80 = 40 rupees.

Worth noting

₹80 is the price at 20 units; to sell one more the firm lowers the price on every unit.

Concept
Marginal revenue from a demand curve
Typical time
90 s
Your time
—
The rule this testsMarginal revenue
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