A profit-maximizing monopolist will produce at a point on the _____ portion of the demand curve where _____.
A)elastic;average revenue is negative
B)inelastic;marginal cost is falling
C)inelastic;total revenue is increasing
D)elastic;marginal revenue is positive

Question

Quizplus · Accepted Answer

A profit-maximizing monopolist will produce in the elastic portion of the demand curve because in this region, lowering the price slightly increases the total revenue, as the percentage increase in quantity demanded is greater than the percentage decrease in price. Additionally, marginal revenue is positive in the elastic portion, meaning that selling an additional unit will increase total revenue.

A Profit-Maximizing Monopolist Will Produce at a Point on the _____