New Port Beach Business Daily

What is the coefficient for the marginal revenue?

Given the following estimated demand function: Qx = 200 – 17Px + 14Ps – 20Pc –0.1Y (where Qx represents quantity demanded; Px represents price of the main product; Ps represents price of the substitute; Pc represents price of the complement and Y represents income) : Px = $10; Ps = $20; Pc = $25 and Y = $2,000. What is the coefficient for the marginal revenue?

Public Comments

1. Qx=200–17Px+14Ps –20Pc–0.1Y =200-17Px+280-500-200 = -220-17Px Qx=-220-17Px 17Px=-220-Qx Px=(-220-Qx)/17 MRx=∂TRx/∂Q TRx=Qx•Px=-(220Qx+Qx²)/17 MRx=-(220+2Qx)/17 ∂MRx/∂Qx= -2/17 ≈-0.118 Answ: -0.118