Figure 9.2 Figure 9.2 above shows the demand and cost curves facing a monopolist.
-Refer to Figure 9.2.To maximise profit, the firm will produce

Question

Figure 9.2 Figure 9.2 above shows the demand and cost curves facing a monopolist. -Refer to Figure 9.2.To maximise profit, the firm will produce A)Q₁. B)Q₂. C)Q₃. D)Q₄.

Quizplus · Accepted Answer

To maximize profit, the firm will produce the quantity where marginal cost (MC) equals marginal revenue (MR), which is where the two curves intersect. In this case, at quantity Q2, the MC curve intersects the MR curve. Therefore, the firm should produce Q₂.

Figure 92 Figure 9