If marginal costs are zero,a monopolist will maximize profit by producing at the point where:
A)average revenue is zero.
B)price is maximum.
C)total revenue is maximum.
D)marginal revenue is maximum.

Question

Quizplus · Accepted Answer

When marginal costs are zero, a monopolist maximizes profit by producing at the point where total revenue is maximized, because without additional costs for producing more units, the profit is maximized when the total revenue is at its highest.

If Marginal Costs Are Zero,a Monopolist Will Maximize Profit by Producing