-The above figure shows the demand and cost curves facing a monopoly.The monopoly maximizes profit by setting price equal to
A)$100.
B)$200.
C)$300.
D)$400.

Question

-The above figure shows the demand and cost curves facing a monopoly.The monopoly maximizes profit by setting price equal to
A)$100. 
B)$200. 
C)$300. 
D)$400.

Quizplus · Accepted Answer

A monopoly maximizes profit where marginal revenue (MR) equals marginal cost (MC). The graph is not visible, but typically, the demand curve would show a downward slope, and the MC curve would upward slope. The intersection point of MR and MC curves indicates the quantity to produce. The price is then determined by going up to the demand curve from this quantity. Without the graph, the correct answer is based on the common understanding of monopoly pricing strategy, which involves setting a price higher than marginal cost to maximize profit, often leading to a price that is significantly above the cost of production.

-The Above Figure Shows the Demand and Cost Curves Facing