The figure below shows the cost and revenue curves for a monopolist. The total cost of producing the profit-maximizing output for the monopolist is _____.
Figure 9.6

A)$95,200
B)$84,000
C)$77,000
D)$53,200
E)$42,000

Question

The figure below shows the cost and revenue curves for a monopolist. The total cost of producing the profit-maximizing output for the monopolist is _____.​ ​
Figure 9.6
​

A)$95,200 
B)$84,000 
C)$77,000 
D)$53,200 
E)$42,000

Quizplus · Accepted Answer

The profit-maximizing output is where marginal revenue equals marginal cost, which is at 400 units in this case. The corresponding price is $190. At this level of output, total revenue is $76,000. Total cost at this level of output is $77,000, which is the sum of fixed cost ($27,000) and variable cost ($50,000). Therefore, the total cost of producing the profit-maximizing output is $77,000.

The Figure Below Shows the Cost and Revenue Curves for a Monopolist