The statement "monopoly sells at a price equal to marginal revenue (P=IM)" is false.
In a monopoly market, there is only one seller of a particular product or service, giving them significant control over the price. Unlike in a perfectly competitive market, where price is determined by the forces of supply and demand, a monopoly can set their price at a level that maximizes their profits.
The marginal revenue (MR) of a monopoly is the change in total revenue resulting from selling one additional unit of the product. MR is typically less than the price (P) because the monopoly must lower the price in order to sell additional units.
To understand this concept, let's consider an example. Imagine a monopoly that sells widgets for $10 each. If the monopoly wants to sell one more widget, they may need to lower the price to $9 in order to attract a buyer. As a result, the marginal revenue would be $9, not $10.
So, in conclusion, the price of a monopoly is not equal to marginal revenue (P ≠ MR). The statement is false.
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