Question

Because the market demand curve slopes down and to the right, the monopolist's marginal revenue will always: equal the market price. equal total revenue. be greater than the market price. be less than the market price.

Answer 1

be less than the market price.

Step-by-step explanation:

Monopolist is the market form which has single seller.

Monopolists have usual downward sloping demand curve, signifying price - demand inverse relationship. And, the monopolist marginal revenue curve is also downward sloping due to 'falling prices' condition.

Demand curve is the 'average revenue' (AR) curve per unit of output sold. It lies above the downward sloping 'marginal revenue' (MR) curve.

So, the monopolist equilibrium output is where MR = MC. The corresponding output level is extended to market demand curve i.e AR curve, higher than the MR curve. So, monopolist MR curve will always be less than the market price.