Exhibit 9-11
-Total revenue for the profit-maximizing monopoly in Exhibit 9-11 that does not price discriminate will be
A) $95,200
B) $84,000
C) $79,000
D) $52,000
E) $42,000

Question

Exhibit 9-11 
-Total revenue for the profit-maximizing monopoly in Exhibit 9-11 that does not price discriminate will be
A) $95,200 
B) $84,000 
C) $79,000 
D) $52,000 
E) $42,000

Quizplus · Accepted Answer

Total revenue is maximized when marginal revenue equals marginal cost. In Exhibit 9-11, marginal revenue is $42,000 when output is 2,000 units. Therefore, total revenue is maximized when output is 2,000 units and price is $47.60 (from the demand curve). Total revenue is then $47.60 x 2,000 = $95,200.

Exhibit 9-11 -Total Revenue for the Profit-Maximizing Monopoly in Exhibit 9-11 That