Bob owns a trout farm with monopoly power in British Columbia.Bob's optimal output occurs where marginal revenue _____ marginal cost.Because of monopoly power,Bob's supply curve _____.
A) equals;does not exist
B) exceeds;does not exist
C) equals;is upward sloping
D) exceeds;is perfectly inelastic

Question

Quizplus · Accepted Answer

In a monopoly, the optimal output is where marginal revenue equals marginal cost. A monopolist does not have a supply curve because they are price makers, not price takers, so the supply curve does not exist.

Bob Owns a Trout Farm with Monopoly Power in British