If a monopoly discovers that the demand for its output has become more elastic at the original output level, then it will respond by
A) producing more and setting a higher price.
B) setting a lower price.
C) setting a higher price.
D) producing more while leaving price unchanged.
B
You might also like to view...
If the demand curve facing a monopolist shifts, then the monopolist's:
A. total cost curve will change, but its variable cost curve will not. B. marginal revenue curve and profit-maximizing level of output will change. C. marginal revenue curve will not change, but its profit-maximizing level of output will. D. marginal revenue curve will change, but its profit-maximizing level of output will not.
From the table below, choose the optimum option using marginal analysis
Option Total Cost ($) 1 150 2 100 3 80 4 70 5 90 6 120 What will be an ideal response?
In a market economy, the decision regarding allocation of resources is made by
a. automatic forces of supply and demand. b. authorities in Washington, D.C. c. planners in state capitals. d. committees from a variety of economic interest groups. e. All of the above are correct.
Starting from long-run equilibrium, a war that raises government purchases results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; potential C. higher; higher D. lower; higher