Question

In the dominant firm model of oligopoly, the dominant firm maximizes profits by producing at the point where:_____________.

Answer 1

The marginal revenue is equal to its marginal cost

Step-by-step explanation:

In the case of the model of a dominant firm with respect to the oligopoly, the firm i.e. dominant could maximize its profits by generating at the point where the marginal revenue is equivalent to the marginal cost

i.e.

Marginal revenue = Marginal cost

At this point, the firm could maximized its profits

Hence, the same is to be considered