A profit maximizing monopolist always chooses to operate at the output level where
A)P = MR = MC.
B)MR = MC = AC.
C)P MR = MC.
D)P

Name: A profit maximizing monopolist always chooses to operate at the output level where A)P = MR = MC. B)MR = MC = AC. C)P > MR = MC. D)P
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Question

A profit maximizing monopolist always chooses to operate at the output level where
A)P = MR = MC.
B)MR = MC = AC.
C)P > MR = MC.
D)P

Quizplus · Accepted Answer

A profit-maximizing monopolist sets output where marginal revenue (MR) equals marginal cost (MC), but price (P) is greater than MR because the monopolist faces a downward-sloping demand curve.

A Profit Maximizing Monopolist Always Chooses to Operate at the Output