The Following Figure Shows the Marginal Revenue (MR) Curve and the Demand

Multiple Choice

The following figure shows the marginal revenue (MR) curve and the demand curve faced by a monopolist. The monopolist faces a constant marginal cost of $3.

-Refer to the figure above.If the average cost faced by the monopolist when it produces and sells the optimal output is $4,the monopolist ________.

A) incurs a loss of $60
B) incurs a loss of $120
C) makes a profit of $60
D) makes a profit of $90