Reference Ref 91 Figure 91 What is this firms marginal reven

Reference: Ref 9-1 (Figure 9.1) What is this firm\'s marginal revenue curve? MR = 18 – 3Q MR = 12 – 0.5Q MR = 18 – 1.5Q MR = 6

Solution

Here MR=6

We know that the MR is the additional revenue when producing one more units of output. Graphically the MR curve is below the demand curve. That is Mr is less than the price. MR is twise as steep as the demand curve. Demand intersect at point 12 Then MR is 6.