The correct answer is: B. Marginal revenue = Marginal cost.
A monopolistic firm is the only seller of a good or service in a market. This means that the firm has a great deal of market power and can set its own prices. However, the firm also faces a downward-sloping demand curve, which means that it cannot charge any price it wants.
The firm will maximize its profits by producing the quantity of output where marginal revenue equals marginal cost. This is because marginal revenue is the additional revenue that the firm earns from selling one more unit of output, and marginal cost is the additional cost that the firm incurs from producing one more unit of output. When marginal revenue equals marginal cost, the firm is producing the quantity of output where the additional revenue from selling one more unit of output is equal to the additional cost of producing one more unit of output. This is the point at which the firm is maximizing its profits.
Option A is incorrect because price is not equal to marginal cost in a monopolistic market. The firm can charge a price above marginal cost because it has market power.
Option C is incorrect because marginal revenue is not equal to price in a monopolistic market. The firm faces a downward-sloping demand curve, which means that marginal revenue is always less than price.
Option D is incorrect because the monopolistic firm will be in equilibrium where marginal revenue equals marginal cost.