For a monopoly, the maximum profit per unit produced is the difference between price and average total cost at the output level at which marginal revenue equals marginal cost.

Question

Quizplus · Accepted Answer

This statement is true. A monopolist will maximize profits by producing the output level where marginal revenue equals marginal cost, and charging the highest price at which they can sell that quantity. The difference between the price and the average total cost at that output level will be the monopolist's maximum profit per unit produced.

For a Monopoly, the Maximum Profit Per Unit Produced Is