Refer to Figure 15-2. A profit-maximizing monopoly's total revenue is equal to:

• A. the price charged multiplied by the quantity sold
• B. the difference between price and average total cost at the profit-maximizing quantity
• C. the sum of marginal revenue and marginal cost at the profit-maximizing quantity
• D. the area under the marginal cost curve up to the profit-maximizing quantity

Answer: (A)

Verified step by step guidance

1. Step 1: Understand the definition of total revenue (TR) for any firm, including a monopoly. Total revenue is the total amount of money a firm receives from selling its product, which is calculated as the price per unit multiplied by the quantity sold.
2. Step 2: Express total revenue mathematically as \(TR = P \times Q\), where \(P\) is the price charged per unit and \(Q\) is the quantity sold.
3. Step 3: Recognize that the profit-maximizing quantity is the quantity where the monopolist maximizes its profit, but total revenue itself is simply the product of price and quantity at that point, regardless of costs or marginal values.
4. Step 4: Differentiate total revenue from other concepts such as profit (which involves costs), marginal revenue (the additional revenue from selling one more unit), and areas under curves (which relate to costs or revenues but are not total revenue directly).
5. Step 5: Conclude that the correct expression for total revenue at the profit-maximizing quantity is the price charged multiplied by the quantity sold, i.e., \(TR = P \times Q\).