For the monopoly represented by the figure to the right, at what quantity is its revenue maximized?
(Hint: Revenue is maximize where
MRequals=0.)
Why is revenue maximized at a larger quantity than profit? Show the revenue curve.
In the figure to the right, let D be demand and MR be marginal revenue.
The quantity at which revenue is maximized is
Qequals=nothing
units. (Enter your response rounded to the nearest whole
number.)
Homework Answers
Since the total revenue is maximised when marginal revenue is equal to zero.
Since MR is zero at quantity 12 units.
Since the monopoly profit is maximised when MR=MC
Since MC is always positive, profit will be maxised when MR is positive and equal to the MC.
That's why revenue is maximised at a large quantities than the quantity at which profit is maximised.
Total revenue is product of price and quantity.
TR=P*Q
Add Answer to:
For the monopoly represented by the figure to the right, at
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if this is considered a natural monopoly and the government sets
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(Table: Prices and Demand) Use
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