Figure 10-2 Figure 10-2 above shows the demand and cost curves facing a monopolist.
-Refer to Figure 10-2.Suppose the monopolist represented in the diagram above produces positive output.What is the profit-maximizing/loss-minimizing output level?
A)630 units
B)800 units
C)850 units
D)880 units

Question

Figure 10-2  Figure 10-2 above shows the demand and cost curves facing a monopolist.
-Refer to Figure 10-2.Suppose the monopolist represented in the diagram above produces positive output.What is the profit-maximizing/loss-minimizing output level?
A)630 units 
B)800 units 
C)850 units 
D)880 units

Quizplus · Accepted Answer

The profit-maximizing/loss-minimizing output level is where marginal revenue equals marginal cost. In the diagram, this occurs at an output level of 630 units.

Figure 10-2 Figure 10-2 Above Shows the Demand and Cost