Use the figure below to answer the following questions.

Figure 13.2.3
-Refer to Figure 13.2.3. Assume this firm is a single-price monopoly. What is the profit-maximizing price to charge for the tickets?
A)$5.00
B)$4.00
C)$3.00
D)$2.00
E)$3.50

Question

Use the figure below to answer the following questions.
  
Figure 13.2.3
-Refer to Figure 13.2.3. Assume this firm is a single-price monopoly. What is the profit-maximizing price to charge for the tickets?
A)$5.00 
B)$4.00 
C)$3.00 
D)$2.00 
E)$3.50

Quizplus · Accepted Answer

The profit-maximizing price is where marginal revenue equals marginal cost. In this case, marginal revenue is $3.50 and marginal cost is $2.00. Therefore, the profit-maximizing price is $3.50.

Use the Figure Below to Answer the Following Questions