Use the following to answer question:
Figure: Demand,Revenue,and Cost Curves
-(Figure: Demand,Revenue,and Cost Curves)Use Figure: Demand,Revenue,and Cost Curves.Figglenuts-R-Us is a monopolist in the figglenut market.Figglenuts-R-Us will sell _____ figglenuts and set a price of _____ to maximize profits.
A)70;$65
B)100;$50
C)120;$40
D)150;$46

Question

Use the following to answer question:
Figure: Demand,Revenue,and Cost Curves 
-(Figure: Demand,Revenue,and Cost Curves)Use Figure: Demand,Revenue,and Cost Curves.Figglenuts-R-Us is a monopolist in the figglenut market.Figglenuts-R-Us will sell _____ figglenuts and set a price of _____ to maximize profits.
A)70;$65 
B)100;$50 
C)120;$40 
D)150;$46

Quizplus · Accepted Answer

Figglenuts-R-Us will maximize profits by producing at the quantity where marginal revenue equals marginal cost. This occurs at a quantity of 70 figglenuts, where marginal revenue is $65. Figglenuts-R-Us will then set a price of $65 to maximize profits.

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