Question

How can a monopolist identify the profit-maximizing level of output if it knows its total revenue and total cost curves?

Short answer

A monopolist can distinguish the benefit augmenting level of result assuming it knows its absolute income and all out cost bends are on the off chance that the contrast between the two is most extreme.

Step-by-step solution

Meaning of monopolist.

Minimal income is an expansion to the complete income. A restraining infrastructure is what is going on in which one firm creates all the result in a market. A monopolist is a cost producer.

We concludes the cost of the wares in view of the interest on the lookout.

Identifying the profit-maximizing level.

The all out income bend for a monopolist first increments arrives at its pinnacle and afterward diminishes and the complete expense bend rises and goes more extreme as result increments. A monopolist can recognize the benefit amplifying level of result assuming it knows its all out income and complete expense bends are in the event that the contrast between the two is greatest. For example: the graph shown here is for profit-maximization.

If the profit-maximizing output is $4$as we can see the maximum difference between the total revenue and the total cost curves is $900$.