MONOPOLY 
95 
his receipts and his expenses when we include 
in the latter a remuneration just sufficient 
to induce him to do the amount of work that 
he does. This difference between his expenses, 
thus widely regarded, and his gross receipts 
may be called monopoly revenue. His object 
is to maximise monopoly revenue, and this 
is maximised when the product of the amount 
sold and the difference between the price and 
the monopolist’s average costs is the greatest 
possible. The theory may be illustrated with 
the aid of the following table :— 
Demand 
Output price 
in tona, per ton. 
90 £50 
100 £49 
110 £48 
120 £46 
Aggregate Aggregate 
receipts. 
£4,500 
£4,900 
£5,280 
£5,520 
costs. 
£4,000 
£4,350 
£4,700 
£5,000 
Monopoly 
Revenue. 
£500 
£550 
£580 
£520 
In the case represented in the table the 
output would be 110 tons, at which output 
monopoly revenue is maximised. 
It looks as if the subject of monopoly were 
drawing us away from the high ground of 
pure theory where the effect of trifling varia 
tions—of differentiating experience—explains 
everything. It is true that the consequences 
of such variations in demand prices and 
supply prices furnish the monopolist with