Suppose that at an output of 1,000 units, a monopolist has marginal cost of $40, marginal revenue of $30, average variable cost of $30, and average total cost of $50 . In order to maximize profit or minimize loss in the short run, the firm should
a. shut down
b. continue to produce 1,000 units
c. produce fewer than 1,000 units but still operate
d. produce more than 1,000 units
e. increase its plant size to gain economies of scale
C
You might also like to view...
According to your text, what is the significant distinction between the government and the nongovernment sector of society?
A) Government decisions are made by collectives rather than by individuals. B) Government is usually granted the right to coerce adults. C) Government officials pursue the public interest rather than narrow special interests. D) Government takes the long-run view and thus cares for the interests of future generations. E) The government sector is not characterized by competition.
In general, the more risk averse a plaintiff is, the ________ willing the plaintiff is to settle, and the ________ the amount the plaintiff will accept to settle.
A) less; higher B) more; lower C) more; higher D) less; lower
Arbitrage
a. Is the act of to buying low in one market and selling high in another market b. Can force a seller to go back to uniform pricing c. Can defeat direct price discrimination d. All of the above
Even if better programs become available, Microsoft's Windows software may retain market dominance because of
a. network externalities. b. its user-friendliness. c. switching costs. d. both a & c.