Which of the following statements applies to a single-price monopolist?
A) In order to maximize profits, the monopolist will produce an amount of output that lies in the elastic range of its demand.
B) In order to maximize profits, the monopolist will produce an amount of output that lies in the inelastic range of its demand.
C) In order to maximize profits, the monopolist will produce where its demand is unit elastic.
D) In order to maximize profits, the monopolist will produce an amount of output in the inelastic range of its supply.

Question

Quizplus · Accepted Answer

A single-price monopolist maximizes profits by producing where marginal revenue equals marginal cost, which occurs in the elastic range of the demand curve.

Which of the Following Statements Applies to a Single-Price Monopolist