The profit-maximising level of output of a monopoly is determined where the marginal-cost curve crosses the:
A)average-revenue curve
B)demand curve
C)marginal-revenue curve
D)average-variable-cost curve

Question

Quizplus · Accepted Answer

The profit-maximizing level of output for a monopoly is where marginal revenue (MR) equals marginal cost (MC), not where average revenue (AR) equals MC or where demand equals MC. Therefore, the correct answer is C, where the MC curve intersects the MR curve.

The Profit-Maximising Level of Output of a Monopoly Is Determined