Hal is the CEO of a firm with a monopoly on a gadget used by kayakers. Hal sells about 200,000 of his products annually, but he would like to make twice that amount available at the same price, hoping to double his income. If we look at the demand curve for Hal’s firm, what will happen as he produces twice as many products?
a. The curve will become vertical.
b. The curve will slope upward.
c. The curve will slope downward.
d. The curve will remain horizontal.
c. The curve will slope downward.
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Break-even quantity is a point where
a. the level of profit is maximized b. the level of cost is minimized c. Only variable costs are covered d. There are zero profits
For a competitive firm, the value of output ___________ and the marginal product of labor ___________ with each additional worker hired.
A. stays constant; decreases B. increases; decreases C. increases; increases D. decreases; stays constant
If the marginal propensity to save (MPS) is 0.25, the value of the spending multiplier is:
a. 1. b. 2. c. 4. d. 9.
A graph that shows all the equally preferred combinations of two goods is called a(n)
a. demand curve b. supply curve c. consumer surplus curve d. equalization curve e. indifference curve