At a price of $20, the marginal revenue of a monopolist is $12. If the marginal cost of production is $10, what should the monopolist do in order to maximize profits?
A. Increase its price.
B. Decrease its price.
C. Keep its price at the same level.
D. There is not enough information to solve.
Answer: B
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A) outlays. B) primary expenditures. C) secondary spending. D) consumption expenditures.
If the price elasticity of demand for U.S. automobiles is higher in Europe than it is in the United States, and transport costs are zero, a price-discriminating monopolist would charge
A) the same price for autos in the United States as in Europe. B) a lower price for autos in the United States than in Europe. C) a higher price for autos in the United States than in Europe. D) a less profitable price for autos in the United States than in Europe.
If pork and beans is an inferior good, other things being equal, an increase in consumer income will decrease the demand for pork and beans
a. True b. False Indicate whether the statement is true or false
Assume that any given percentage of the population earns an equal percentage of real GDP. This percentage of population will be represented by:
a. a point below the line of income equality. b. a line lying below the line of income equality. c. a point on the line of income equality. d. a line lying above the line of income equality. e. a point above the line of income equality.