The perfectly discriminating monopolist will produce the
A) quantity at which average cost exceeds marginal revenue.
B) quantity at which marginal cost equals average cost.
C) quantity at which marginal revenue equals marginal cost.
D) quantity and price which is not necessarily profit-maximizing but in the ?best interest of society at large, even if it means loss.

Question

Quizplus · Accepted Answer

The perfectly discriminating monopolist is able to charge a different price to each individual consumer based on their willingness to pay. Therefore, the monopolist will continue to sell to each consumer up to the point where their marginal cost equals that consumer's marginal willingness to pay, which is equivalent to marginal revenue. Thus, the monopolist will produce the quantity at which marginal revenue equals marginal cost.

The Perfectly Discriminating Monopolist Will Produce the