Refer to the graph shown. At an output of a, the monopolist should:
A. reduce output to increase profits.
B. not change output since profits are maximized.
C. increase price to increase profits.
D. increase output to increase profits.
Answer: D
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The above figure shows Bobby's indifference map for juice and snacks. Also shown are three budget lines resulting from different prices for snacks. Bobby's demand for snacks is
A) unit elastic. B) elastic. C) inelastic. D) perfectly elastic.
Suppose that workers in Transylvania can produce only two goods -- yo-yos or sweatsocks. The Transylvanian currency is the daler. In what unit is the opportunity cost of yo-yos measured?
a. dalers b. dalers per yo-yo c. dalers per sweatsock d. yo-yos e. sweatsocks
If there are economies of scale throughout the relevant output range of production, which is false? a. It is a natural monopoly
b. It is more efficient to have a single firm produce the good. c. It would typically result from a firm's possession of an exclusive patent. d. One large firm can produce at lower cost than two or more smaller firms.
Economists at which administrative department help enforce the nation's antitrust laws?