Answer the question on the basis of the following information for a pure monopolist: $\begin{array}{c}\begin{array}{ccc}& & \\ \text{ Output }& & \text{ Total Cost }\\ 0& & \$250\\ 1& & 260\\ 2& & 290\\ 3& & 350\\ 4& & 480\\ 5& & 700\end{array}\begin{array}{l}\text{ Product }\\ \begin{array}{c}\text{ Price }\\ \$500\\ 300\\ 250\\ 200\\ 150\\ 100\end{array}\end{array}\end{array}$ The given nondiscriminating monopolist should set its price at:

A) $300.
B) $250.
C) $200.
D) $150.

To determine the optimal price for the monopolist, we calculate the marginal cost (MC) and marginal revenue (MR) for each level of output and then find where MC = MR. Marginal cost is the change in total cost when output is increased by one unit, and marginal revenue is the change in total revenue when output is increased by one unit.- For 1 unit: MC = $260 - $250 = $10, MR = $500 - $0 = $500 (since total revenue at 0 units is $0).- For 2 units: MC = $290 - $260 = $30, MR = ($300 * 2) - ($500 * 1) = $600 - $500 = $100.- For 3 units: MC = $350 - $290 = $60, MR = ($250 * 3) - ($300 * 2) = $750 - $600 = $150.- For 4 units: MC = $480 - $350 = $130, MR = ($200 * 4) - ($250 * 3) = $800 - $750 = $50.The monopolist maximizes profit where MR = MC, which occurs closest at the output level of 3 units (since the MR of $150 is closest to the MC of $60 for the next unit). The price corresponding to 3 units of output is $200, making option C the correct choice.