Thus the price of the product is given for the consumer.
The price of the commodity is decided by the monopolist. Or, once he sets the price for his product, his output is determined by what consumers will take at that price. TR is the total revenue curve which goes on rising to begin with, then flattens and later on slopes downward, showing fall in total receipts after a given point.
On the other hand, if the scope is limited, then it can be seen that one day rival will come and may wipe out the existing monopolists, by providing a touch competition.
Its Limitations: Though interesting, this measure of monopoly power has many limitations. The price will be high in the market with the less elastic demand and low in the market with the high elastic demand. Such a tax does not help in regulating monopoly price and output.