For a monopolist, the point where the marginal revenue curve intersects the horizontal axis is:
A. located at the same point where the demand curve intersects the horizontal axis, since for a monopolist, the demand curve and the marginal revenue curve overlap.
B. unable to be determined without knowing the location of the marginal cost curve.
C. one-fourth of the distance between the origin and the point where the demand curve intersects the horizontal axis.
D. one-half the distance between the origin and the point where the demand curve intersects the horizontal axis.
Answer: D
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U.S. antitrust laws are designed to prohibit monopolization and encourage competition. Why, then, does the government erect barriers to entry and create monopoly power by granting firms patents?
What will be an ideal response?
Which of the following is a negative externality connected to automobile transportation?
A) Driving faster than the 65 mph speed limit is not allowed, even though individuals are able to do it, and many want to. B) In an accident, a person who chooses not to wear a seatbelt becomes an object moving around the inside of the car, possibly hitting other, belted-in, passengers with lethal force. C) Gasoline is taxed on a per-gallon basis. D) Gasoline is imported, and thus increases the trade deficit. E) While stuck in traffic, you have a chance to listen to your favorite CD, which you haven't had the time to do in other places.