Exhibit 9-21 -In Exhibit 9-21, D = AR Represents the Market Demand

question 6

Multiple Choice

Exhibit 9-21
-In Exhibit 9-21, D = AR represents the market demand curve for bicycles, MR_m represents the marginal revenue curve for a monopolist producer of bicycles and S_c = MC = AC represents the marginal cost curve for a monopolist producer of bicycles and the market supply curve when the market is perfectly competitive. The output for a monopolist would be

• A) 2 bicycles
• B) 3 bicycles
• C) 4 bicycles
• D) 5 bicycles
• E) 6 bicycles

---

Definitions:

Beta

A measure of a stock's volatility in relation to the overall market.

Required Return

The minimum expected return an investor seeks for holding a risky investment, considering both time value of money and risk factors.

Expected Return

The weighted average of all possible returns from an investment, accounting for the probability of each outcome.

Beta

An indicator of how much a stock's price fluctuates compared to the entire market, showing the level of risk associated with its returns.