A company estimates that the total revenue, R, in dollars, received from the sale of items is R = ln (1+1000Q^2). Calculate and interpret the marginal revenue if q=10

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Deborah

Mathematics

19 June, 17:52

A company estimates that the total revenue, R, in dollars, received from the sale of items is R = ln (1+1000Q^2). Calculate and interpret the marginal revenue if q=10

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Sonny Potts · Answer 1

R=ln (1+1000q^2)

dr/dq=1 / (1+1000q^2) * 2000q

dr/dq is the "marginal revenue" which is the instantaneous rate of change at q=10, used to approximate the revenue generated by increasing the sales by 1.

The approximation is just that, to truly calculate the additional revenue produced by the next unit sold you would need to find r (11) - r (10)