-The figure above shows the demand,marginal revenue,and marginal cost curves for Paul's Parrot pillows,a monopoly producer of pillows stuffed with parrot feathers.When Paul maximizes his profit,Paul produces ________ pillows per hour,and if the market was perfectly competitive,________ pillows per hour would be produced.
A) 0; 4,000
B) 3,000; 4,000
C) 4,000; 4,000
D) 3,000; 3,000
E) 0; 3,000

Question

-The figure above shows the demand,marginal revenue,and marginal cost curves for Paul's Parrot pillows,a monopoly producer of pillows stuffed with parrot feathers.When Paul maximizes his profit,Paul produces ________ pillows per hour,and if the market was perfectly competitive,________ pillows per hour would be produced.
A) 0; 4,000 
B) 3,000; 4,000 
C) 4,000; 4,000 
D) 3,000; 3,000 
E) 0; 3,000

Quizplus · Accepted Answer

A monopolist maximizes profit where marginal revenue equals marginal cost, which is at 3,000 pillows per hour in this scenario. In a perfectly competitive market, production occurs where price equals marginal cost, which corresponds to the demand curve at 4,000 pillows per hour.

-The Figure Above Shows the Demand,marginal Revenue,and Marginal Cost Curves