Use the figure to answer the following question(s).
Figure 11-2
-The cost and demand conditions for a monopolist are depicted in Figure 11-2. If the monopolist is maximizing profit, it will charge a price of
A) $30 and produce an output of 4,000.
B) $40 and produce an output of 4,000.
C) $40 and produce an output of 2,000.
D) more than $40.

Question

Use the figure to answer the following question(s).
Figure 11-2 
-The cost and demand conditions for a monopolist are depicted in Figure 11-2. If the monopolist is maximizing profit, it will charge a price of
A) $30 and produce an output of 4,000. 
B) $40 and produce an output of 4,000. 
C) $40 and produce an output of 2,000. 
D) more than $40.

Quizplus · Accepted Answer

A monopolist maximizes profit by producing where marginal cost equals marginal revenue. The corresponding price is determined by the demand curve at that output level.

Use the Figure to Answer the Following Question(s)