A monopolist will maximize profits byA) setting his price as high as possible.B) setting his price at the level that will maximize per-unit profit.C) producing the output where marginal revenue equals marginal cost.D) producing the output where price equals marginal cost.

Question

A monopolist will maximize profits byA)  setting his price as high as possible.B)  setting his price at the level that will maximize per-unit profit.C)  producing the output where marginal revenue equals marginal cost.D)  producing the output where price equals marginal cost.

christina ragan · Accepted Answer

Final Answer : C, Explanation :  A monopolist maximizes profits by producing the output level where marginal revenue equals marginal cost, as this is the point where the additional cost of producing one more unit equals the additional revenue gained from selling it.

A monopolist will maximize profits by

A) setting his price as high as possible.
B) setting his price at the level that will maximize per-unit profit.
C) producing the output where marginal revenue equals marginal cost.
D) producing the output where price equals marginal cost.

Definitions

Learning Objectives

Learning Objectives

Related questions