Question

Assume that when the price is Rs. 20, the quantity demanded is 15 units, and when the price is Rs. 18, the quantity demanded is 16 units. Based on this information, what is the marginal revenue resulting from an increase in output from 15 units to 16 units?

• A. Rs. 18
• B. Rs. 16
• C. Rs. 12
• D. Rs. 28

Answer 1

The correct option is C Rs. 12

$MR=\frac{ChangeinTR}{Changeinoutput}$
$=\frac{(16\times 18)-(15\times 20)}{16-15}=Rs.12$