Which of the following is true about where a profit-maximizing monopoly will produce on a linear demand curve when it has positive marginal costs?
A. It will produce output where MR < 0.
B. It will produce output where MR = 0.
C. It will produce output on the elastic portion of the demand curve.
D. It will produce output on the inelastic portion of the demand curve.
Answer: C
Economics
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A) larger; higher B) larger; smaller C) smaller; higher D) smaller; smaller
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