For a monopolist A)MR = P. B)MR P. C)MR

Name: For a monopolist A)MR = P. B)MR > P. C)MR < P. D)MR has no relation to P.
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Question

For a monopolist
A)MR = P.
B)MR > P.
C)MR < P.
D)MR has no relation to P.

Quizplus · Accepted Answer

MR (Marginal Revenue) is always less than the price for a monopolist because they have to decrease the price of all units sold to sell an additional unit. This leads to a downward-sloping demand curve and a corresponding decline in revenue for each additional unit sold. Therefore, the monopolist can only increase sales by lowering the price, resulting in a lower MR than the price.

For a Monopolist