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(Scenario: a Monopolist) a Monopolist Faces a Demand Curve Given

Question 3

Multiple Choice

(Scenario: A Monopolist) A monopolist faces a demand curve given by P = 20 - Q and has total costs given by TC = Q2. By using a bit of calculus, you should be able to determine that the firm's marginal revenue is MR = 20 - 2Q and its marginal cost is MC = 2Q. What is its profit-maximizing output level?


A) 5
B) 6
C) 7
D) 8

Correct Answer:

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