Which of the following is true for the single priced monopolist?
A) Marginal revenue is equal to the price charged.
B) Economic profit is always zero in the long run.
C) Profit-maximising occurs when marginal revenue is greater than the marginal cost.
D) Profit-maximising occurs when marginal revenue is equal to the marginal cost.

Question

Quizplus · Accepted Answer

In order to maximize profits, a single priced monopolist will produce where marginal revenue (MR) equals marginal cost (MC). This is because MR represents the additional revenue generated by producing an additional unit, while MC represents the additional cost of producing that unit. By setting MR=MC, the firm is producing the quantity of output where the additional revenue from selling one more unit is equal to the additional cost of producing that unit, and therefore maximizing profits.

Which of the Following Is True for the Single Priced