If a monopolist's price is $50 at the output where marginal revenue equals marginal cost and average total cost is $43, then the average profit is $7.

Question

Quizplus · Accepted Answer

The monopolist's profit per unit can be calculated as the difference between the price and the average total cost: 
Profit per unit = Price - Average Total Cost = $50 - $43 = $7 
Therefore, the average profit, which is the profit per unit multiplied by the quantity sold, is equal to $7. This makes the statement true.

If a Monopolist's Price Is $50 at the Output Where