When a Monopolist Faces a U-Shaped Average Cost Curve in the Short

question 221

Multiple Choice

When a monopolist faces a U-shaped average cost curve in the short run,we know that as more and more output is produced,the

• A) law of diminishing marginal returns eventually overrules the decrease in average fixed cost.
• B) decrease in average fixed cost eventually overrules the law of diminishing marginal returns.
• C) decrease in average fixed cost always overrules the law of diminishing marginal returns.
• D) law of diminishing marginal returns always overrules the decrease in average fixed cost.
• E) law of diminishing marginal returns coincides with the decrease in average fixed cost.

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Definitions:

Rewards and Punishments

Behavioral tools used to reinforce desired behaviors or diminish undesired ones, often employed in educational and developmental contexts.

Learning

A relatively permanent change in behavior brought about by making associations between behavior and events in the environment.

Psychosexual Stages

A theory by Freud describing the stages of a child's development from birth to adulthood, through which sexual energy (libido) is focused on different erogenous zones.

Freud

Sigmund Freud, an Austrian neurologist who is known for founding psychoanalysis, a method for treating psychopathology through dialogue between a patient and a psychoanalyst.