To sell one more unit of a good, a monopolist must
A) lower the price on the last unit only.
B) lower the price on all units.
C) raise the price only on the last unit sold.
D) raise the prices on all goods.

Question

Quizplus · Accepted Answer

A monopolist must lower the price on all units sold to sell one more unit because it faces a downward-sloping demand curve. This means that to increase sales, the monopolist must reduce the price, and this price reduction applies to all units sold, not just the additional unit.

To Sell One More Unit of a Good, a Monopolist