If a monopolist's marginal revenue exceeds its marginal cost at its current level of output, then to maximize its profit the monopolist should:
A. do nothing.
B. increase output until price equals marginal cost.
C. decrease output in order to increase the gap between marginal revenue and marginal cost.
D. increase output until marginal revenue equals marginal cost.
Answer: D
You might also like to view...
In economics, the optimal level of pollution is the level for which the net benefit from reducing the pollution is the greatest
Indicate whether the statement is true or false
What is a good argument for using the model of the consumer despite the fact that it requires making many simplifying assumptions?
A) It is complex to solve. B) The assumptions are sometimes realistic. C) It explains observed patterns of behavior. D) It is used in many scholarly fields.
The relative prices of the products that use natural resources intensively will decrease over time with the decrease in the availability of the natural resources.
Answer the following statement true (T) or false (F)
If there are concerns about moral hazard and adverse selection in a country
A. economic growth will reduce. B. there will be more foreign direct investment. C. it will be easier to arrange financing for new development projects. D. there will be more portfolio investment.