The above figure shows the demand and cost curves for a monopolist. What is the maximum economic profit this firm can make?
A) zero
B) $400
C) $100
D) $200
D
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Inflation reduces economic efficiency because it does each of the following except:
A. Obscure information transmitted by prices. B. Distort incentives through interaction with the tax laws. C. Change relative prices. D. Induce people to minimize cash holdings.
Which of the following does not determine the position and shape of a society’s production possibilities frontier?
A. Physical resources B. Price level C. Skills and technology D. Past investment in factories and in research
Firms in a monopolistically competitive industry produce:
a. homogeneous goods and services. b. differentiated products. c. competitive goods only. d. consumption goods only.
Which of the following statements is correct?
A. Slope is the ratio of the vertical change (the rise or fall) to the horizontal change (the run). B. A direct relationship is one in which two variables change in the opposite direction. C. An inverse relationship is one in which two variables change in same directions. D. An independent relationship is one in which two variables are upward sloping.