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Consider a Profit-Maximizing Single-Price Monopolist That Faces a Linear Demand

Question 28

Multiple Choice

Consider a profit-maximizing single-price monopolist that faces a linear demand curve.The firm would not set a price at which demand is inelastic because


A) marginal revenue is zero in that range of output.
B) average revenue is zero in that range of output.
C) the marginal revenue would be negative in that range of output.
D) the average revenue would be negative in that range of output.
E) the marginal revenue and average revenue would be equal in that range of output.

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