The point of profit maximization for a monopolist is exemplified by
A) TR = TC.
B) MR = MC.
C) ATCmin.
D) MR MC.

Question

The point of profit maximization for a monopolist is exemplified by
A) TR = TC.
B) MR = MC.
C) ATCmin.
D) MR > MC.

Quizplus · Accepted Answer

The point of profit maximization for a monopolist is where marginal revenue (MR) equals marginal cost (MC). Therefore, option B is the correct choice. Option A indicates the point of revenue maximization, which may not necessarily coincide with the point of profit maximization. Option C refers to minimizing average total cost, which is not a relevant consideration in determining the profit-maximizing output level. Option D would result in a suboptimal level of profits for the monopolist.

The Point of Profit Maximization for a Monopolist Is Exemplified