When a firm is in a monopolistic competition market if the f

When a firm is in a monopolistic competition? market, if the firm sells 25 goods at a product price of? $10, what is the marginal revenue per unit of the good sold if it sells 5 additional goods when it reduced the product price to? $9.

A.

?$270

B.

?$20

C.

?$4

D.

?$2.50

Solution

Total revenue at 25 units=25*10=250

Total revenue at 30 units=30*9=270

what is the marginal revenue per unit of the good sold=change in total revenue/change in number of units

=(270-250)/(30-25)

=4

The above should be the answer..