At the long-run equilibrium level of output, the monopolist's marginal cost will
A) exceed price.
B) equal price.
C) be less than price.
D) be less than marginal revenue.

Question

Quizplus · Accepted Answer

In a monopoly, the price is set above marginal cost because the monopolist maximizes profit where marginal revenue equals marginal cost, and since the demand curve is downward sloping, price is greater than marginal revenue.

At the Long-Run Equilibrium Level of Output, the Monopolist's Marginal