If P = price and MC = marginal cost,the price markup of a monopolist is expressed as _____.
A)(P - MC)/MC
B)(P - MC)/P
C)(MC - P)/MC
D)(MC - P)/P

Question

Quizplus · Accepted Answer

The price markup of a monopolist is expressed as (P - MC)/P. This formula shows the percentage increase in price (markup) over the marginal cost of producing one additional unit. Therefore, option B is the correct answer.

If P = Price and MC = Marginal Cost,the Price