Question

If the market price for a chair is $24 and the marginal cost for the chair is $7, the marginal revenue from the chair would be _____.

Answer 1

Based on the given data above, the answer that would best complete the given statement would be $24. If the market price for a chair is $24 and the marginal cost for the chair is $7, the marginal revenue from the chair would be $24. Hope this answer helps.

Answer 2

If the market price for a chair is $24 and the marginal cost for the chair is $7, the marginal revenue from the chair would be $24. The marginal cost of production is the cost of producing one additional unit.

Marginal revenue is the additional profit that will be generated by increasing product sales by one unit. Competitive firms experience marginal revenue that is equal to the market price. Producing chairs is part of the competitive market, which means that the marginal revenue is the same as the market price, $24.