7 . Monopoly and Price Elasticity Consider the relationship between monopoly pricing and the price elasticity of demand. If demand is inelastic, total revenue would increase when a monopolist V its price. As a result, total cost would V . Therefore, a monopolist will Y produce a quantity at which the demand curve is inelastic. Use the purple segment (diamond symbols) to indicate the portion of the demand curve that is Inelastic. (Hint: The answer is related to the marginal revenue (MR) curve.) Then use the black point (plus symbol) to show the quantity and price that maximizes total revenue (TR). @ 10 Demand 9 00 B 7 Inelastic Demand 5 _ + 5 . 4 Max TR a, 3 .2 E 2 1 l) i 71 -2 Marginal Revenue ,3 __ _4 ,, Quantity