A monopolist will spend resources to advertise its product so long as

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A monopolist will spend resources to advertise its product as long as it leads to an increase in net profits. Gross profits or total revenue alone may not be sufficient to justify advertising expenses, as they do not take into account the costs incurred in advertising. Demand may also not be a reliable indicator, as a monopolist can have high demand even without advertising, due to its market power. Therefore, the best choice is net profits, which reflects the overall profitability of the business.

A Monopolist Will Spend Resources to Advertise Its Product So