Answer (B) is correct . Marginal revenue (MR) is the incremental revenue for each additional unit sold (increase in revenue ÷ increase in units sold). If expected revenue of $72,600 is a 10% increase over that for the prior year, the prior year’s revenue must have been $66,000 ($72,600 ÷ 110%). MR = $72,600 – $66,000 = $6,600 = $6 1,100 1,100
Answer (A) is incorrect because The marginal revenue per unit is equal to the increase in revenue divided by the increase in units sold.
Answer (C) is incorrect because The total fixed costs ($22,000) divided by the increase in sales (1,100) is $20. The marginal revenue per unit is equal to the increase in revenue divided by the increase in units sold.
Answer (D) is incorrect because The marginal revenue per unit is equal to the increase in revenue divided by the increase in units sold, not the difference of expected sales minus fixed costs, divided by the unit increase in sales.
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