Suppose a firm in a competitive market produces and sells 8 units of output and has a marginal revenue of $8.00. what would be the firm's total revenue if it instead produced and sold 4 units of output?

(a) $4.00
(b) $8.00
(c) $32.00
(d) $64.00
(e) cannot be determined with the information given.

The correct answer is "(C) $32.00".

Explanation: The marginal income is the income obtained from the sale of one more unit of product.

In a market of perfect competition, the company is accepting price.

Therefore the total income is given by the calculation: Price x Quantity.

Then: 8 x 4 = $ 32.

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