Revenue Maximisation in Monopoly
Study Edexcel Economics monopoly questions by using the revenue-maximising condition that marginal revenue equals zero at the relevant output.
- Syllabus
- 2019
- Course
- Economics YEC11
- Level
- A2
Exam points
- Identify revenue maximisation at the output where marginal revenue equals zero.
- Link the zero marginal-revenue condition to the point at which total revenue is maximised.
- Read the monopoly question’s stated output condition before selecting the correct relationship.
3.3.2.1b - Price elasticity of demand and its relationship to revenue concepts, including question 1
[Maximum number: 1]
A monopoly is operating at its revenue maximising output. Which one of the following is true?
A
Marginal revenue is equal to marginal cost
B
Average revenue is equal to average cost
C
Average fixed costs are rising
D
Marginal revenue is zero
D
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