Exhibit 9.2

-Refer to Exhibit 9.2,which shows the cost and revenue curves faced by a monopolist.The demand curve faced by the monopolist at the profit-maximizing output is _____
A)perfectly price elastic.
B)price elastic.
C)price inelastic.
D)unit price elastic.
E)perfectly price inelastic.

Question

Exhibit 9.2
 
-Refer to Exhibit 9.2,which shows the cost and revenue curves faced by a monopolist.The demand curve faced by the monopolist at the profit-maximizing output is _____
A)perfectly price elastic. 
B)price elastic. 
C)price inelastic. 
D)unit price elastic. 
E)perfectly price inelastic.

Quizplus · Accepted Answer

At the profit-maximizing output, a monopolist operates where marginal revenue equals marginal cost. The demand curve at this point is typically price elastic because the monopolist can increase total revenue by lowering the price, indicating that the percentage change in quantity demanded is greater than the percentage change in price.

Exhibit 9.2 -Refer to Exhibit 9.2,which Shows the Cost and Revenue Curves