The figure below shows the cost and revenue curves faced by a monopolist. At the profit-maximizing output level for the monopolist, _____.
Figure 9.1

A)marginal revenue is zero
B)marginal revenue is equal to marginal cost
C)marginal cost is less than marginal revenue
D)marginal cost is equal to average total cost
E)price is equal to marginal cost

Question

The figure below shows the cost and revenue curves faced by a monopolist. At the profit-maximizing output level for the monopolist, _____.​ ​
Figure 9.1

A)marginal revenue is zero 
B)marginal revenue is equal to marginal cost​ 
C)marginal cost is less than marginal revenue 
D)marginal cost is equal to average total cost 
E)price is equal to marginal cost

Quizplus · Accepted Answer

The monopolist will produce where marginal revenue (MR) equals marginal cost (MC) to maximize profits. This occurs at the output level where the MR and MC curves intersect, which is represented by point Q in the graph. Therefore, at the profit-maximizing output level, marginal revenue is equal to marginal cost.

The Figure Below Shows the Cost and Revenue Curves Faced