Figure 9.9 Figure 9.9 shows the demand and cost curves for a monopolist.
-Refer to Figure 9.9.The difference between the monopoly output and the perfectly competitive output is
A)140 units
B)240 units
C)340 units
D)560 units

Question

Figure 9.9  Figure 9.9 shows the demand and cost curves for a monopolist.
-Refer to Figure 9.9.The difference between the monopoly output and the perfectly competitive output is
A)140 units 
B)240 units 
C)340 units 
D)560 units

Quizplus · Accepted Answer

The perfectly competitive output is where the demand and marginal cost curves intersect, at a quantity of 460 units. The monopoly output is where the marginal revenue and marginal cost curves intersect, at a quantity of 120 units. Therefore, the difference between the monopoly output and the perfectly competitive output is 460 - 120 = 340 units.

Figure 99 Figure 9