A Monopoly Earns Total Revenue of $5,000 When It Sells

question 369

True/False

A monopoly earns total revenue of $5,000 when it sells 500 units of output and total revenue of $5,400 when it sells 600 units of output. Thus, the marginal revenue of the 600th unit is $9.

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Definitions:

Reverse Stock Split

A decrease in the number of a corporation's outstanding shares, which increases the share price proportionally.

Market Value

The cost at which you can currently buy or sell a service or asset in the open market.

Par Value

The nominal or face value of a bond, stock, or coupon as stated by the issuer, which may not necessarily reflect its market value.

Stock Split

A corporate action where a company divides its existing shares into multiple shares to boost the liquidity of the shares, though the overall value of the company remains the same.