The following figures show the demand and cost curves of a perfectly competitive and a monopoly firm respectively. Figure 10.7
D: Average Revenue
AC: Average cost
MC: Marginal cost
MR: Marginal cost
-According to Figure 10.7,when the monopolist is maximizing profit:
A)its resources are not being used efficiently.
B)its price is higher than that charged by the perfectly competitive firm.
C)its price is equal to the price charged by the perfectly competitive firm.
D)it is earning above-normal profit.
E)it is actually incurring a loss.

Question

The following figures show the demand and cost curves of a perfectly competitive and a monopoly firm respectively. Figure 10.7  
D: Average Revenue
AC: Average cost
MC: Marginal cost
MR: Marginal cost
-According to Figure 10.7,when the monopolist is maximizing profit:
A)its resources are not being used efficiently. 
B)its price is higher than that charged by the perfectly competitive firm. 
C)its price is equal to the price charged by the perfectly competitive firm. 
D)it is earning above-normal profit. 
E)it is actually incurring a loss.

Quizplus · Accepted Answer

The Answer of The following figures show the demand and cost curves of a perfectly competitive and a monopoly firm respectively. Figure 10.7  
D: Average Revenue
AC: Average cost
MC: Marginal cost
MR: Marginal cost
-According to Figure 10.7,when the monopolist is maximizing profit:
A)its resources are not being used efficiently. 
B)its price is higher than that charged by the perfectly competitive firm. 
C)its price is equal to the price charged by the perfectly competitive firm. 
D)it is earning above-normal profit. 
E)it is actually incurring a loss.

The Following Figures Show the Demand and Cost Curves of a Perfectly