Micro Foundations · intro
What moves on the Monopoly & Cost Curves diagram
With market powermarket powerThe ability to profitably hold price above marginal cost., stronger demand raises both quantity and price, profit expands on both margins.
The monopolist sits at MR = MC, pricing off demand.
Demand strengthens. D and MR shift right together.
Output AND the markup rise: monopolists convert demand booms into bigger profit boxes.
Examiners ask this as: monopoly demand rises, market power boom.
Other scenarios on Monopoly & Cost Curves