Figure 11-3
-In Figure 11-3, which of the following is true, whether or not the monopolist is maximizing profits?
A)MR

Question

Figure 11-3 
-In Figure 11-3, which of the following is true, whether or not the monopolist is maximizing profits?
A)MR < P. 
B)MC = P. 
C)MC < AC. 
D)MR = P.

Quizplus · Accepted Answer

In a monopoly, the marginal revenue (MR) is always less than the price (P) because to sell additional units, the monopolist must lower the price, not just for the additional units but for all units sold. This characteristic distinguishes monopoly pricing from perfect competition, where price equals marginal revenue.

Figure 11-3 -In Figure 11-3, Which of the Following Is True, Whether