Bit Johnson sells four units of his famous BJ733 barbecue grill system, resulting in a total revenue of $420. His total revenue for five units is $460. The price on the four units is $105 per unit and the price for the five units (per unit) is $92. What is the marginal revenue for the fifth unit?
A. $13
B. $40
C. -$40
D. $52
E. $26
Answer: (B) Marginal revenue for this problem is calculated by subtracting the $420 total revenue for four units from the $460 total revenue for the five units. This is the formula used to calculate marginal revenue. The price per unit given for this problem is simply not needed and not taken into account when making calculations for marginal revenue. When this calculation is performed, there is a marginal revenue figure of $40 (A), (C), (D), and (E) are not the correct answer, and are miscalculations or guesses.