Why Is MR < P for a Monopolist

question 278

Multiple Choice

Why is MR < P for a monopolist?

• A) The monopolist restricts output, and marginal cost rises as more output is produced.
• B) The monopolist is constrained by market demand, so in order to sell even one more unit of output, it must lower the price.
• C) The demand for the monopolist's product is price elastic.
• D) The monopolist has large economies of scale, so its average total cost is constantly falling, and it can still profit at a lower price.

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