Table 10.4 outlines the cost and revenue data for a monopolist.

-Refer to Table 10.4 to answer this question.What are the profit-maximizing level of output and price respectively?
A)3 and $35.
B)4 and $30.
C)5 and $25.
D)5 and $30.
E)6 and $20.

Question

Table 10.4 outlines the cost and revenue data for a monopolist.
 
-Refer to Table 10.4 to answer this question.What are the profit-maximizing level of output and price respectively?
A)3 and $35. 
B)4 and $30. 
C)5 and $25. 
D)5 and $30. 
E)6 and $20.

Quizplus · Accepted Answer

The profit-maximizing level of output is where marginal cost (MC) equals marginal revenue (MR). Without the specific table data, the general principle is to find where MC=MR and then determine the price from the demand curve at that quantity. Option B suggests a scenario that typically aligns with profit-maximizing behavior in economic theory.

Table 104 Outlines the Cost and Revenue Data for a Monopolist