Scenario 15-3
A monopoly firm maximizes its profit by producing Q = 500 units of output. At that level of output, its marginal revenue is $30, its average revenue is $60, and its average total cost is $34.
-Refer to Scenario 15-3. At Q = 500, the firm's profit is
A)$13,000.
B)$15,000.
C)$17,000.
D)$30,000.

Question

Quizplus · Accepted Answer

The firm's profit is calculated as (Average Revenue - Average Total Cost) * Quantity = ($60 - $34) * 500 = $13,000.

Scenario 15-3 A Monopoly Firm Maximizes Its Profit by Producing Q =