Can anyone explain to me how to work out marginal revenue in this case?

    • Thread Starter

    A wine merchant will supply bottles of champagne to a wedding at £10 per bottle but is willing to offer a 10% discount on the total bill if 50 bottles or more are purchased. What would be the firm's marginal revenue for the 50th bottle?

    I don't understand a thing about it and the teacher just moved on assuming everyone will know this because it is easy. I'm terrified.

    Remember that marginal revenue is the change in total revenue brought about by the sale of one more unit. So the way to answer this is to work out the Total revenue from 49 bottles (49 x £10 = £490). Then work out the Total Revenue from the sale of 50 bottles (50 x £9 (10% discount) = £450). So the MR is -£40.
Write a reply… Reply
Submit reply


Thanks for posting! You just need to create an account in order to submit the post
  1. this can't be left blank
    that username has been taken, please choose another Forgotten your password?
  2. this can't be left blank
    this email is already registered. Forgotten your password?
  3. this can't be left blank

    6 characters or longer with both numbers and letters is safer

  4. this can't be left empty
    your full birthday is required
  1. Oops, you need to agree to our Ts&Cs to register
  2. Slide to join now Processing…

Updated: September 26, 2016
TSR Support Team

We have a brilliant team of more than 60 Support Team members looking after discussions on The Student Room, helping to make it a fun, safe and useful place to hang out.

Which is the best season?

The Student Room, Get Revising and Marked by Teachers are trading names of The Student Room Group Ltd.

Register Number: 04666380 (England and Wales), VAT No. 806 8067 22 Registered Office: International House, Queens Road, Brighton, BN1 3XE

Quick reply
Reputation gems: You get these gems as you gain rep from other members for making good contributions and giving helpful advice.