For a monopoly,marginal revenue for all units greater than 1:
A) is always less than the price.
B) cannot be negative.
C) is zero when total profits are maximized.
D) is always greater than marginal cost.

Question

Quizplus · Accepted Answer

In a monopoly, the marginal revenue curve is downward sloping and lies below the demand curve. This means that for all units greater than 1, the marginal revenue is always less than the price. Therefore, Option A is the correct answer. Option B is incorrect because marginal revenue can be negative for units greater than 1. Option C is incorrect because marginal revenue is not always zero at the profit-maximizing level of output. Finally, Option D is incorrect because in a monopoly, marginal revenue can be less than marginal cost at the profit-maximizing level of output.

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