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Condition for equilibrium in monopoly: MC is equal to MR. MC curve cuts the MR from below. -

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Question

Condition for equilibrium in monopoly:

  1. MC is equal to MR.
  2. MC curve cuts the MR from below.

Options

  • Option (i) is correct.

  • Option (ii) is correct.

  • Both options are correct.

  • None of the above.

MCQ
Fill in the Blanks

Solution

Both options are correct.

Explanation:

Equilibrium requires the following conditions:

  1. Marginal revenue equals marginal cost.
  2. The marginal revenue curve is cut from below by the marginal cost curve.
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Ordinal Approach (Utility Analysis)
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