For a monopoly,marginal revenue for all units greater than 1:
A)is always less than price because of the price effect.
B)is always more than price because of the price effect.
C)is always more than price because of the quantity effect.
D)is always less than price because of the quantity effect.

Question

Quizplus · Accepted Answer

For a monopoly, marginal revenue is always less than price due to the price effect. This is because a monopoly must lower the price on all units in order to sell additional units, resulting in a lower marginal revenue.

For a Monopoly,marginal Revenue for All Units Greater Than 1