If at an output of 10 units a monopolist is earning a positive profit, marginal revenue is $6, and marginal cost is $4, then the

Question

Brums [2.3K]

4 years ago

12

If at an output of 10 units a monopolist is earning a positive profit, marginal revenue is $6, and marginal cost is $4, then the

monopolist:

Business

1 answer:

LuckyWell [14K] · Answer 1 · 2021-11-28T09:34:55+03:00

Answer:

Increase output

Explanation:

A monopolist will stay in the market and increase output as long as the MR< MC. In the above scenario, marginal revenue is $6, and the marginal cost is $4 which means that monopolist is earning positive profits. In this case, a monopolist should increase the output to earn more profit. A monopolist will increase output until MR=MC.