-The above figure shows the demand and cost curves facing a monopoly.The monopoly maximizes profit by selling
A) 0 units.
B) 25 units.
C) 50 units.
D) 75 units.

Question

-The above figure shows the demand and cost curves facing a monopoly.The monopoly maximizes profit by selling
A) 0 units. 
B) 25 units. 
C) 50 units. 
D) 75 units.

Quizplus · Accepted Answer

A monopoly maximizes profit where marginal revenue equals marginal cost, which typically occurs at a quantity less than the market equilibrium in a competitive market. Without seeing the actual figure, the general principle is that the profit-maximizing quantity is not at the extremes (0 or maximum possible units) but at a point where the firm can still exert some price control. Assuming a standard demand curve, selling 25 units could represent a point where marginal revenue equals marginal cost, leading to profit maximization.

-The Above Figure Shows the Demand and Cost Curves Facing