At the profit-maximizing output in a monopoly controlled market,the price a monopolist charges is ________ cost.
A) below marginal
B) above marginal
C) above average total
D) below average total
E) equal to marginal

Question

Quizplus · Accepted Answer

At the profit-maximizing output level, a monopolist will choose to produce where marginal revenue equals marginal cost (MR=MC). However, since the demand curve for a monopolist is downward sloping, the price they charge will be higher than the marginal cost. Therefore, the correct answer is (B) above marginal cost.

At the Profit-Maximizing Output in a Monopoly Controlled Market,the Price