question archive Which of the following options is correct? A monopolist will earn economic profits as long as his price exceeds a
Which of the following options is correct? A monopolist will earn economic profits as long as his price exceeds a
Subject:MarketingPrice:2.88 Bought3
Which of the following options is correct?
A monopolist will earn economic profits as long as his price exceeds
a. average variable cost.
b. average fixed cost.
c. marginal revenue.
d. average total cost.
Purchase A New Answer
Custom new solution created by our subject matter experts
GET A QUOTE
Answer Preview
The correct answer is d. average total cost.
The price at which one unit is sold is the average revenue earned from a unit. If the price and, therefore, the average revenue is higher than the average total cost the total revenue will be higher than the total cost. This will mean that the monopolist earns an economic profit.
