HOW TO FIND EQUILIBRIUM IN MONOPOLY

To find equilibrium in a monopoly , we follow the following steps

1- Draw the two axes. On the x-axis take price and on the y-axis take quantity.

2- Draw the marginal cost, marginal revenue and the demand curves.

3- The point where the marginal cost curve intersects with the marginal revenue curve is the equilibrium point.

4- To find equilibrium quantity, see the value on x-axis that equilibrium point corresponds to.

5- To find equilibrium price, find the point on demand curve at which equilibrium quantity will be demanded and then correspond that point to y-axis.

6- You have your equilibrium price and quantity