Question

If demand for a monopolist's product falls, price quantity and profit

Answer 1

The diagram initially de e ent & when hesit diagram depicts that tially monopolist maximizes Price! his profit by , producing at point where Quantity produced is oly and price in p* MMR R As the demand falls to pl i au luantity and MR falls to MR', the new equilibrium point is where cuantity has fallen og and price has also fallen to ope; This fall in price and quantity leads to u profit. Thus, ich demand for a monopolist's product price decreases, Quantity decreases and profits decreases. to fall fealls,