Question:

The pure monopolist who is nondiscriminating must decrease price on all units of aproduct sold in order to sell additional units. This explains why:

A.

there are barriers to entry in pure monopoly.

B.

a monopoly has a perfectly elastic demand curve.

C.

marginal revenue is less than average revenue.

D.

total revenues are greater than total costs at the profit maximizing level of output.

Answer» c. marginal revenue is less than average revenue.