The figure below depicts a monopolist.

In order to maximize profit, this monopolist will charge a price of

Question

The figure below depicts a monopolist.

In order to maximize profit, this monopolist will charge a price of

BlackTom AI · Accepted Answer

Monopolists set output where marginal revenue (MR) equals marginal cost (MC), and then use the demand curve to find the price consumers will pay for that output.

1) Relevant concepts  
- Profit maximization for a monopolist: choose Q such that MR = MC.  
- The monopoly price is the price on the demand curve corresponding to that Q.  
- Reading values from the graph: horizontal (price) and vertical (quantity) dashed lines indicate the equilibrium coordinates.

2) Step-by-step reasoning  
- Locate the MR and MC curves on the diagram.  
- Find their intersection point: the MR and MC curves cross at the vertical dashed line labeled Q = 12. Thus the profit-maximizing output is Q* = 12.  
- Move vertically from Q* up to the demand curve; the corresponding price on the vertical axis is P* = $23 (the graph shows a dashed horizontal at $23 through the demand curve at Q = 12).

3) Intermediate “calculation” steps (graph reading)  
- MR = MC => Q* = 12 (read off where MR and MC intersect).  
- From Q* = 12, go to demand curve => P* = $23 (read off the price level on the left axis).

4) Why $23 is correct  
- Because $23 is the price indicated by the demand curve at the output where MR = MC, it is the profit-maximizing price for the monopolist. The firm cannot raise profit by changing output or price away from this point without violating the MR = MC rule.

5) Why the other options are incorrect  
- $20: corresponds to a different point on the demand curve (a different Q, e.g., near Q = 9) and not where MR = MC.  
- $9 and $12: these are lower price/average-cost markers on the graph (e.g., $9 is near the minimum ATC or a lower price level) but are not the price associated with MR = MC at Q = 12.

6) Conclusion  
- The profit-maximizing price is $23, which matches the provided correct answer.

The figure below depicts a monopolist. In order to maximize profit, this monopolist will charge a price of单项选择题

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69. Refer to the diagram for a pure monopolist. If the monopolist is unregulated, it will maximize profits by charging A. a price above P3 and selling a quantity less than Q3. B. price P3 and producing output Q3. C. price P2 and producing output Q2. D. price P1 and producing output Q1.

69. Refer to the diagram for a pure monopolist. If the monopolist is unregulated, it will maximize profits by charging A. a price above P3 and selling a quantity less than Q3. B. price P3 and producing output Q3. C. price P2 and producing output Q2. D. price P1 and producing output Q1.

The graph provided shows the demand (D), marginal revenue (MR), marginal cost (MC), and average total cost (ATC) curves for a monopolist. If a regulatory agency requires that the monopolist set a price that earns the monopolist a normal profit, what price will the monopolist set?

Suppose an unregulated electric company is a monopolist and faces demand of Q = 50 – 10P. If this company has zero marginal costs, its profit-maximizing price is

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