If a monopolist produces to a point at which marginal revenue is less than marginal cost then
A) profits are being maximized.
B) profits will always be negative.
C) the incremental cost of producing the last unit exceeds the incremental revenue.
D) the incremental cost of producing the last unit is less than the incremental revenue.

Question

Quizplus · Accepted Answer

When a monopolist produces to a point at which marginal revenue is less than marginal cost, it means that the cost of producing an additional unit is more than the revenue earned by selling that unit. This leads to a decrease in profits and may even result in negative profits. Therefore, the correct choice is C.

If a Monopolist Produces to a Point at Which Marginal