Question

Marginal Revenue is equal to : ____________.

• A. The change in price divided by the change in output.
• B. The change in quantity divided by the change in price.
• C. The change in $p\times Q$ due to a one unit change in output.
• D. Price, but only if the firm is a price searcher.

Answer 1

Answer: (C)

The change in $p\times Q$ due to a one unit change in output.

Marginal revenue refers to the change in revenue or additional revenue which a firm earns on selling a unit more of its output. IT is the change in Revenue= Price x Quantity.