The following diagram shows the demand curve,D,the marginal revenue curve,MR,and the marginal cost curve,MC,facing a monopolist.
-Refer to the diagram above.At the profit-maximizing level of output,the monopolist collects total revenue equal to the area
A) 0A.
B) 0CEA.
C) 0GIH.
D) 0BKA.
E) 0C.

Question

The following diagram shows the demand curve,D,the marginal revenue curve,MR,and the marginal cost curve,MC,facing a monopolist. 
-Refer to the diagram above.At the profit-maximizing level of output,the monopolist collects total revenue equal to the area
A) 0A. 
B) 0CEA. 
C) 0GIH. 
D) 0BKA. 
E) 0C.

Quizplus · Accepted Answer

The monopolist collects total revenue equal to the area 0CEA at the profit-maximizing level of output. This is because total revenue is equal to price times quantity, and the monopolist sets price and quantity to maximize profits.

The Following Diagram Shows the Demand Curve,D,the Marginal Revenue Curve,MR,and