Question

what is the best definition of marginal revenue?
○ the possible income from producing an additional item
○ the price of producing one additional unit of a good
○ the additional income gained from selling an additional good
○ the financial gain from business activity minus expenses

Explanation:

To determine the best definition of marginal revenue, we analyze each option:

• "the possible income from producing an additional item": Marginal revenue is about selling, not just producing, so this is incorrect.
• "the price of producing one additional unit of a good": This describes marginal cost, not revenue.
• "the additional income gained from selling an additional good": This matches the definition of marginal revenue, which is the change in total revenue from selling one more unit.
• "the financial gain from business activity minus expenses": This is the definition of profit, not marginal revenue.

Answer:

C. the additional income gained from selling an additional good