A. Once a monopolist chooses their profit-maximizing level of output, they use t

Question

A. Once a monopolist chooses their profit-maximizing level of output, they
use the _________________________ to find the highest price it can charge
for that quantity.
B. For a profit-maximizing monopoly that charges the same price to all
consumers, the price (<, =, >) marginal revenue and
marginal revenue (<, =, >) marginal cost. (Circle the correct answer for each.)
C. When a monopolist switches from charging a single price to perfect price
discrimination, it reduces _________________________.

Explanation / Answer

A. Once a monopolist chooses their profit-maximizing level of output, they
use the MR = MC to find the highest price it can charge
for that quantity.
B. For a profit-maximizing monopoly that charges the same price to all
consumers, the price > marginal revenue and
marginal revenue = marginal cost.
C. When a monopolist switches from charging a single price to perfect price
discrimination, it reduces deadweight loss

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