Figure: Monopoly Markup Refer to the figure. The monopolist's price markup is:
A) a - b.
B) b - d.
C) d.
D) a - d.

Name: Figure: Monopoly Markup Refer to the figure. The monopolist's price markup is: A) a - b. B) b - d. C) d. D) a - d.
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Question

Figure: Monopoly Markup  Refer to the figure. The monopolist's price markup is:
A) a - b. 
B) b - d. 
C) d. 
D) a - d.

Quizplus · Accepted Answer

The price markup for a monopoly is the difference between the price they charge and the marginal cost of producing one more unit, which in this graph is represented by the distance between points B and D. Therefore, the answer is B - D.

Figure: Monopoly Markup Refer to the Figure