Which of the following best characterizes the tradeoff faced by a monopolist when deciding what quantity to produce?
A. The firm can increase its output, but needs to lower its price for only the marginal unit of output.
B. The firm can increase its output, but to do so it must charge a higher price to all customers.
C. The firm gets more revenue from new customers by increasing output, but gets less revenue from existing customers given that it lowered its price.
D. The firm gets less revenue from new customers by increasing output, but gets more revenue from existing customers given that it lowered its price.
Answer: C
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The formula for the slope across an arc is used to approximate the slope for
A) linear relationships only. B) a curved line. C) a positive relationship only. D) a negative relationship only.
John M. Keynes is best known for advocating:
(a) A policy of annually balancing the budget. (b) Deficit spending during some recessions. (c) Contractionary fiscal policy during a recession. (d) Expansionary fiscal policy during a boom.
A U.S. tariff on steel would increase the domestic quantity of steel supplied.
Answer the following statement true (T) or false (F)
Define the following terms. Give a complete and precise definition in one sentence. a. total utility b. marginal utility c. consumer’s surplus d. “law” of demand
What will be an ideal response?