The no-trade equilibrium in a monopolistic market occurs where:

Question

Quizplus · Accepted Answer

In a monopolistic market, the no-trade equilibrium occurs where the monopolist produces the quantity of output where its marginal cost (MC) equals its marginal revenue (MR). At this point, the monopolist has no incentive to produce any more or any less because producing more will increase costs more than revenue, and producing less will result in lost revenue. Therefore, the equilibrium occurs where MC=MR.

The No-Trade Equilibrium in a Monopolistic Market Occurs Where