Asked by
Dacia Edwards
on Dec 12, 2024
Verified
Which of the following is true of marginal revenue for a monopolist that charges a single price?
A) P = MR because there are no close substitutes for the monopolist's product.
B) P > MR because the monopolist must decrease price on all units sold in order to sell an additional unit.
C) P < MR because the monopolist must decrease price on all units sold in order to sell an additional unit.
D) P = MR only at the profit-maximizing quantity.
Marginal Revenue
The extra revenue earned by selling an additional unit of a product or service.
Monopolist
An entity that is the sole provider of a particular product or service, controlling the market and setting prices without competition.
- Become familiar with how marginal revenue and marginal cost affect pricing and output decisions in a monopoly.
Verified Answer
AN
Learning Objectives
- Become familiar with how marginal revenue and marginal cost affect pricing and output decisions in a monopoly.
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