Suppose that a monopolist calculates that at present output and sales, marginal cost is $1.00 and marginal revenue is $2.00. She could maximize profits by:
A. decreasing output and leaving prices unchanged.
B. decreasing price and increasing output.
C. increasing price and decreasing output.
D. decreasing price and leaving output unchanged.
Answer: B
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When the government cuts the income tax rate, the real wage rate paid by employers ________ and the real wage rate received by workers ________ and potential GDP ________
A) increases; increases; increases B) decreases; decreases; increases C) increases; decreases; increases D) decreases; increases; decreases E) decreases; increases; increases
Which firm provides the better signal when trying to decide which of the? firms' stock to? buy?
A. Firm? D, which? hasn't been under SEC investigation for over 5 years. B. Firm? C, which has seen its stock go up by? $20 per share in the last week. C. Firm? B, which uses an internal group for auditing. D. Firm? A, which uses an independent accounting firm for auditing.
The alternative combinations of final goods and services that could be produced in a given time period with all available resources and technology are known as
A. Nominal GDP. B. Production possibilities. C. Consumption possibilities. D. Real GDP.
If the economy has automatic stabilizers built in, the multiplier will
A. be smaller than it would have been in the absence of automatic stabilizers. B. be zero. C. be larger than it would have been in the absence of automatic stabilizers. D. be infinitely larger than it would have been in the absence of automatic stabilizers.