Graph 15-3 This graph reflects the cost and revenue structure for a monopoly firm.Use the graph to answer the following question(s).
-Refer to Graph 15-3.At the profit-maximising level of output, average revenue is equal to:
A)P₃
B)P₂
C)P₁
D)P₀

Question

Graph 15-3  This graph reflects the cost and revenue structure for a monopoly firm.Use the graph to answer the following question(s).
-Refer to Graph 15-3.At the profit-maximising level of output, average revenue is equal to:
A)P₃ 
B)P₂ 
C)P₁ 
D)P₀

Quizplus · Accepted Answer

At the profit-maximizing level of output, marginal revenue equals marginal cost. At this point, average revenue is equal to price, which is P3 on the graph.

Graph 15-3 This Graph Reflects the Cost and Revenue