-The figure above shows a monopoly firm's demand curve. If the price and quantity of haircuts move from point t to point r, the monopoly's
A) total revenue will rise.
B) total revenue will fall.
C) total revenue will remain the same.
D) marginal revenue will decrease.

Question

-The figure above shows a monopoly firm's demand curve. If the price and quantity of haircuts move from point t to point r, the monopoly's
A) total revenue will rise. 
B) total revenue will fall. 
C) total revenue will remain the same. 
D) marginal revenue will decrease.

Quizplus · Accepted Answer

When moving from point t to point r on a monopoly's demand curve, the price decreases and quantity increases. Since the demand curve is downward sloping, this indicates that the price reduction leads to a proportionally larger decrease in total revenue, causing total revenue to fall.

-The Figure Above Shows a Monopoly Firm's Demand Curve