-Refer to the above graph to answer this question.Suppose that the graph represents a monopolist.At what price and output would the monopolist maximize its total revenue?
A)$0 and 50.
B)$0 and 100.
C)$10 and 50.
D)$12 and 40.
E)Cannot be determined.

Question

-Refer to the above graph to answer this question.Suppose that the graph represents a monopolist.At what price and output would the monopolist maximize its total revenue?
A)$0 and 50. 
B)$0 and 100. 
C)$10 and 50. 
D)$12 and 40. 
E)Cannot be determined.

Quizplus · Accepted Answer

Total revenue is maximized at the output level where marginal revenue equals zero. Without seeing the graph, the general principle is that a monopolist increases output up to the point where marginal cost equals marginal revenue. Assuming a downward-sloping demand curve, this typically does not occur at the extremes of the output range (i.e., not at the maximum possible output or zero). Among the given options, without specific details from the graph, option C is a plausible scenario where the monopolist has increased output to a level (not the maximum possible) and set a price that could maximize total revenue, following standard economic theory on monopolistic behavior.

-Refer to the Above Graph to Answer This Question