Suppose a monopoly is producing output so that marginal revenue equals marginal cost. If the monopolist reduces output, it:
A. can charge a higher price.
B. will increase profits.
C. will decrease marginal revenue.
D. can charge a higher price and it will increase profits.
A. can charge a higher price.
You might also like to view...
A PPF is a straight line as a result of
A) constant opportunity costs. B) increasing opportunity costs. C) decreasing opportunity costs. D) scarcity. E) choice.
Jay owns a classic car he purchased for $50,000. At a car rally a knowledgeable classic car enthusiast offers him $75,000 for the car. Based on this information:
A. Jay's saving this year has decreased by $25,000. B. Jay's saving this year has increased by $25,000. C. Jay has experienced a $25,000 capital gain. D. Jay's wealth is unchanged.
What contributes to the existence of multiproduct firms?
A. Economies of scale B. Cost complementarity C. Economies of scope and cost complementarity D. Economies of scope
To affect the market outcome, a price ceiling
A) must be set below the black market price. B) must be set below the legal price. C) must be set below the price floor. D) must be set below the equilibrium price.