If a monopolist's marginal cost shifts upward,:

Question

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If the marginal cost shifts upward, the monopolist will produce less output and charge a higher price, which will reduce the total quantity sold. This decrease in quantity sold will result in a decrease in total revenue, assuming the demand curve has a negative slope. Therefore, total revenue will fall. If a monopolist's marginal cost shifts upward, the monopolist will produce less and charge a higher price, resulting in a decrease in the quantity demanded. Since the monopolist has market power, the price increase will not be offset by an increase in quantity. As a result, total revenue will fall.

If a Monopolist's Marginal Cost Shifts Upward