(Table: Total and Marginal Revenue II) Use the Table to Answer

question 74

Multiple Choice

(Table: Total and Marginal Revenue II) Use the table to answer the question. The marginal revenue of changing from a quantity of 1 to 2 is $____.

• A) 12
• B) 8
• C) 4
• D) 0

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Definitions:

Decreasing Returns to Scale

A situation in which, when the scale of production is increased, the output increases at a proportionally lower rate.

Minimum Efficient Scale

The smallest level of production a company can achieve while still taking full advantage of economies of scale in terms of costs per unit.

Long-Run Average Cost Curve

A graphical representation showing the lowest average cost of producing any output level when all inputs can be varied.

Plant Size

Plant Size pertains to the capacity or physical dimensions of a manufacturing or production facility.