If the demand for the single-price monopoly's good is elastic, what is the relationship between the market price and the firm's marginal revenue?

Question

Accepted Answer

A cut in the monopoly's price decreases marginal revenue by more than the price cut.

Answer

A cut in the monopoly's price makes marginal revenue negative.

Answer

Marginal revenue is unchanged when the monopoly lowers its price.

Answer

Marginal revenue and price change by the same amount.

Answer

A cut in the monopoly's price decreases marginal revenue by less than the price cut.

Crowdly