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CA Foundation · Quantitative Aptitude · Differential and Integral Calculus

The total revenue function of a firm is R(x) = 60x − 0.5x² (in ₹). The output at which marginal revenue becomes zero is:

Marginal revenue is the derivative of revenue, which is 60 − x here. Setting it to zero gives an output of 60 units, and since the second derivative is negative, total revenue is maximised at this output.

  1. A30 units
  2. B60 unitsCorrect
  3. C120 units
  4. D90 units

Explanation

MR = dR/dx = 60 − x. Setting MR = 0 gives x = 60. Check: R''= −1 < 0, so revenue is maximum there. The value 120 comes from wrongly solving 60 − 0.5x = 0, and 30 from halving 60.

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