Narrbegin Exhibit 8.5 Demand and cost data for a monopolist
$\begin{array}{|c|c|c|c|c|c|}
\hline \text { Price } & \text { Quantity } & \text { TR } & \text { MR } & \mathrm{TC} & \text { Profi } \
\hline \$ 10 & 1 & 10 & 10 & 4 & \
\hline 9 & 2 & & & 8 & \
\hline 8 & 3 & & & 12 & \
\hline 7 & 4 & & & 16 & \
\hline 6 & 5 & & & 20 & \
\hline 5 & 6 & & & 24 & \
\hline 4 & 7 & & & 28 & \
\hline 3 & 8 & & & 32 & \
\hline 2 & 9 & & & 36 & \
\hline 1 & 10 & & & 40 & \
\hline
\end{array}$
-Refer to Exhibit 8.5. The demand schedule and cost schedule for a monopolist are provided. Which output level maximises profit?
A) 2.
B) 4.
C) 5.
D) 6.

Question

Narrbegin Exhibit 8.5 Demand and cost data for a monopolist
 $\begin{array}{|c|c|c|c|c|c|}
\hline \text { Price } & \text { Quantity } & \text { TR } & \text { MR } & \mathrm{TC} & \text { Profi } \
\hline \$ 10 & 1 & 10 & 10 & 4 & \
\hline 9 & 2 & & & 8 & \
\hline 8 & 3 & & & 12 & \
\hline 7 & 4 & & & 16 & \
\hline 6 & 5 & & & 20 & \
\hline 5 & 6 & & & 24 & \
\hline 4 & 7 & & & 28 & \
\hline 3 & 8 & & & 32 & \
\hline 2 & 9 & & & 36 & \
\hline 1 & 10 & & & 40 & \
\hline
\end{array}$ 
-Refer to Exhibit 8.5. The demand schedule and cost schedule for a monopolist are provided. Which output level maximises profit?
A) 2.
B) 4.
C) 5.
D) 6.

Quizplus · Accepted Answer

To maximize profit, the monopolist should produce where marginal revenue (MR) equals marginal cost (MC). Calculating MR and MC from the given data, the profit-maximizing output is at quantity 4.

Narrbegin Exhibit 8 -Refer to Exhibit 8