Which of the following best explains why the monopolist's marginal revenue is less than the selling price?
A) To sell more units, the monopolist must reduce price on all units sold.
B) As the monopolist expands output, the average total cost will decline.
C) The monopolist charges each consumer the highest possible price.
D) When a firm has a monopoly, consumers have no choice other than to pay the price set by the monopolist.

Question

Quizplus · Accepted Answer

A monopolist faces a downward-sloping demand curve, which means that to sell more units, the monopolist must lower the price on all units sold. As a result, the marginal revenue from selling an additional unit is less than the selling price.

Which of the Following Best Explains Why the Monopolist's Marginal