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When the Monopoly Firm Sells Two Units of Its Product

Question 27

Multiple Choice

When the monopoly firm sells two units of its product, it earns total revenue of $960 and it incurs a total cost of $870. If its marginal revenue for the second unit was $475, what was the marginal revenue of the first unit?


A) $90
B) $485
C) $395
D) $1,355
E) There is not enough information to answer the question.

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