Figure 10.10 depicts the cost and revenue curves for a monopolist.

-Refer to Figure 10.10 to answer this question.What is the level of profits at the profit-maximizing output?
A)0.
B)$20.
C)$150.
D)$450.
E)$600.

Question

Figure 10.10 depicts the cost and revenue curves for a monopolist.
 
-Refer to Figure 10.10 to answer this question.What is the level of profits at the profit-maximizing output?
A)0. 
B)$20. 
C)$150. 
D)$450. 
E)$600.

Quizplus · Accepted Answer

At the profit-maximizing output, the level of profits is determined by the difference between total revenue and total cost. Without seeing Figure 10.10, the specific answer cannot be directly verified. However, in typical economic models, the profit-maximizing output is where marginal cost equals marginal revenue. The profit at this point is the area between the total revenue and total cost curves, assuming the question is based on such a model.

Figure 1010 Depicts the Cost and Revenue Curves for a Monopolist