a A monopolist multimizes profits by setting to marginal cost equal to dis marginal revenue. True False Uncertain

Question

a A monopolist multimizes profits by setting to marginal cost equal to dis marginal revenue. True False Uncertain

Answer 1

FalseA monopolist maximizes profits by setting marginal revenue equal to marginal cost, not by setting them equal to each other. In a monopoly, the marginal revenue is always less than the price because the monopolist has to lower the price to sell additional units. Therefore, the profit-maximizing condition for a monopolist is to produce the quantity where marginal revenue equals marginal cost.

Soru

a A monopolist multimizes profits by setting to marginal cost equal to dis marginal revenue. True False Uncertain

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