Figure 15-2 above shows the demand and cost curves facing a monopolist.
-Refer to Figure 15-2.To maximize profit,the firm will produce at output level
A)Q1.
B)Q2.
C)Q3.
D)Q4.

Question

Figure 15-2 above shows the demand and cost curves facing a monopolist.
-Refer to Figure 15-2.To maximize profit,the firm will produce at output level
A)Q1. 
B)Q2. 
C)Q3. 
D)Q4.

Quizplus · Accepted Answer

The profit-maximizing output level for a monopolist is where marginal revenue (MR) equals marginal cost (MC), which occurs at quantity Q2 in this case. At any other output level, the monopolist could increase profit by producing more or producing less, but at Q2 the firm is making the most profit possible.

Figure 15-2 Above Shows the Demand and Cost Curves Facing