We know that in the long run, perfectly competitive firms produce where MR = MC andend up making zero economic profit. The profit-maximizing output level for a monopolist is where
A) price is maximized
B) quantity is maximized
C) ATC curve is minimized
D) maximum efficiency is achieved
E) MR = MC

Question

Quizplus · Accepted Answer

A monopolist maximizes profit by producing at the quantity where marginal revenue (MR) equals marginal cost (MC), similar to firms in perfect competition. However, unlike in perfect competition, this does not lead to zero economic profits in the long run for a monopolist due to barriers to entry and lack of perfect substitutes.

We Know That in the Long Run, Perfectly Competitive Firms