Table 24.1 Monopoly Costs and Revenue
$$\begin{array} { | c | c | c | }
\hline \text { Quantity } & \text { Price } & \text { Total Cost } \
\hline 1 & \$ 500 & \$ 400 \
\hline 2 & \$ 450 & \$ 650 \
\hline 3 & \$ 400 & \$ 950 \
\hline 4 & \$ 350 & \$ 1,300 \
\hline 5 & \$ 300 & \$ 1,700 \
\hline
\end{array}$$ In Table 24.1,the maximum profit that can be achieved is
A)-$200.
B)$100.
C)$250.
D)$500.

Question

Table 24.1 Monopoly Costs and Revenue
$$\begin{array} { | c | c | c | } 
\hline \text { Quantity } & \text { Price } & \text { Total Cost } \
\hline 1 & \$ 500 & \$ 400 \
\hline 2 & \$ 450 & \$ 650 \
\hline 3 & \$ 400 & \$ 950 \
\hline 4 & \$ 350 & \$ 1,300 \
\hline 5 & \$ 300 & \$ 1,700 \
\hline
\end{array}$$ In Table 24.1,the maximum profit that can be achieved is
A)-$200.
B)$100.
C)$250.
D)$500.

Quizplus · Accepted Answer

The maximum profit is achieved when marginal revenue equals marginal cost. In this case, marginal revenue is $100 and marginal cost is $150. Therefore, the maximum profit is $250.

Table 241 Monopoly Costs and Revenue In Table 24