-The monopolist shown in the above graph
A)is making a profit.
B)is taking a loss.
C)is breaking even.
D)may be making a profit or breaking even.
E)may be taking a loss or breaking even.

Question

-The monopolist shown in the above graph
A)is making a profit. 
B)is taking a loss. 
C)is breaking even. 
D)may be making a profit or breaking even. 
E)may be taking a loss or breaking even.

Quizplus · Accepted Answer

A monopolist makes a profit when the price (P) is greater than average total cost (ATC) at the quantity where marginal cost (MC) equals marginal revenue (MR).

-The Monopolist Shown in the Above Graph