The demand function for a certain product is represented by the equation: $p = 20 + 5x-3x^2$, where $x$ is the number of units demanded and $p$ is the price per unit (in Rs.),then the marginal revenue when 2 units are sold, is:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs.4 **
Demand function: $p=20+5x-3x^{2}$
Total revenue: $R=xp=x(20+5x-3x^{2})=20x+5x^{2}-3x^{3}$
Marginal revenue: $\frac{dR}{dx}=20+10x-9x^{2}$
At $x=2$:
$MR=20+10(2)-9(2^{2})$
$MR=20+20-36$
$MR=4$
The marginal revenue when 2 units are sold is $4$.