Find the marginal revenue of a firm that sells a product at a price of Rs. 10 and the price elasticity of demand for the product is (-) 2.

Rs. 5
Rs. 10
Rs. 30
Rs. 15

The correct answer is A. Rs. 5.

Marginal revenue is the additional revenue that a firm earns from selling one more unit of a good or service. It is calculated by taking the change in total revenue and dividing it by the change in quantity sold.

In this case, the price of the good is Rs. 10 and the price elasticity of demand is (-) 2. This means that if the firm lowers the price by 1%, the quantity demanded will increase by 2%.

To calculate marginal revenue, we can use the following formula:

MR = P * (1 + 1/E)

where:

MR = marginal revenue

P = price

E = price elasticity of demand

In this case, MR = 10 * (1 + 1/(-2)) = 5.

Therefore, the marginal revenue of the firm is Rs. 5.

Option B is incorrect because it is the price of the good.

Option C is incorrect because it is the total revenue of the firm.

Option D is incorrect because it is the average revenue of the firm.

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