If a monopolist calculates its marginal revenue to be $15 and marginal cost to be $16, then the monopolist should:
A. lower its price.
B. decrease its output.
C. increase its output.
D. leave its output and price unchanged.
Answer: B
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Refer to the above figure. Line ACE is called
A) the consumption function. B) the saving function. C) the savings function. D) the 45-degree line.
When a group of firms acts in unison to maximize profits as if they were a monopoly, they form a __________
Fill in the blank(s) with correct word
If the reserve requirement is 10 percent, a bank desires to hold no excess reserves, and it receives a new deposit of $500, it
a. must increase required reserves by $50. b. will initially see reserves increase by $500. c. will be able to use this deposit to make new loans amounting to $450. d. All of the above are correct.
Derrick owns and operates a bakery. Every Saturday he bakes a batch of fresh kolaches, and every Saturday he sells all the kolaches and has to turn some customers away. Which of the following statements is correct?
A. At the current price, quantity demanded exceeds quantity supplied. B. The current price is higher than the equilibrium price. C. If Derrick lowered the price of kolaches, the shortage would increase. D. both a and c E. all of the above