Question

If the demand function for a monopoly's product is p=108−4q then the firm's marginal revenue function is

A. MR=98−6q
B. MR=−8Q
C. MR=108−5q
D. MR=108−8q

Answer 1

The marginal revenue function for a monopoly can be derived by taking the derivative of the demand function with respect to quantity (q). The correct answer is option B. The marginal revenue function for this monopoly is MR = -8q.

Step-by-step explanation:

Answer:

The marginal revenue function for a monopoly can be derived by taking the derivative of the demand function with respect to quantity (q). In this case, the demand function is p = 108 - 4q. The marginal revenue function for a monopoly can be derived by taking the derivative of the demand function with respect to quantity (q). The correct answer is option B. The marginal revenue function for this monopoly is MR = -8q. Taking the derivative, we get:
Mᵣ = -4

Option B. MR = -8Q

The correct answer is option B. The marginal revenue function for this monopoly is MR = -8q, not option A, C, or D. It is important to note that the negative sign indicates a decreasing marginal revenue as quantity increases.