Because the market demand curve slopes down and to the right, the monopolist's marginal revenue will always be
A) greater than the market price.
B) less than the market price.
C) equal to the market price.
D) equal to total revenue.

Question

Quizplus · Accepted Answer

Because the monopolist must lower the price to sell more units, the additional revenue gained from selling one more unit (marginal revenue) is less than the price at which the unit is sold. This is due to the fact that to sell the additional unit, the monopolist must lower the price of all units sold, not just the additional unit.

Because the Market Demand Curve Slopes Down and to the Right