A monopolist maximizes profit at the point where the _____ of production is equal to:

Question

Quizplus · Accepted Answer

A monopolist maximizes profit where marginal cost (MC) is equal to marginal revenue (MR), not where MC equals price or total revenue, nor where average total cost equals price. This is because the profit-maximizing quantity is found at the point where the cost of producing one more unit (MC) is exactly covered by the revenue gained from selling that additional unit (MR).

A Monopolist Maximizes Profit at the Point Where the _____