A monopolist will fix the equilibrium output of his product where the elasticity of his AR curve is

Solution (By Examveda Team)

In a monopoly market, the firm determines its equilibrium output at the point where Marginal Revenue (MR) equals Marginal Cost (MC).

The Average Revenue (AR) curve of a monopolist is the same as the demand curve, which is downward sloping. Because of this, the elasticity of demand plays an important role in determining equilibrium.

When the price elasticity of demand is less than one (inelastic), the marginal revenue becomes negative. A monopolist will never produce in this region because producing additional output would reduce total revenue.

The monopolist therefore operates only in the elastic portion of the demand (AR) curve, where marginal revenue is positive. At the equilibrium point, elasticity must be greater than or equal to one.

Thus, a monopolist fixes equilibrium output where the elasticity of the AR curve is greater than or equal to one.

Hence, the correct answer is Option B: Greater than or equal to one.