For a monopoly,marginal revenue is often greater than the price they charge for their good.

Question

Quizplus · Accepted Answer

In a monopoly, the firm has the power to control the price of its goods or services as there is no competition, and the demand for the product or service is high. However, in order to increase its sales, the firm may lower the price, which will lead to an increase in demand. This means that the marginal revenue will be less than the price they charge, as they have to lower the price in order to increase the quantity demanded. Therefore, marginal revenue is usually lesser than the price charged by a monopolist.

For a Monopoly,marginal Revenue Is Often Greater Than the Price