Under which of the following does a monopoly's demand curve become its marginal revenue curve?
A) Only price discrimination on the basis of the number of units purchased
B) Any monopoly that price discriminates
C) All types of monopoly
D) Only single-price monopoly
E) Only perfect price discrimination

Question

Quizplus · Accepted Answer

In the case of perfect price discrimination, a monopoly charges each consumer the maximum they are willing to pay for each unit, thus selling each unit at a different price. This means the price for each additional unit sold (marginal revenue) equals the price consumers are willing to pay for that unit, making the demand curve and the marginal revenue curve the same.

Under Which of the Following Does a Monopoly's Demand Curve