-Refer to the Graph Above

question 23

Multiple Choice

-Refer to the graph above.Compared to long-run equilibrium under perfect competition,a monopoly in this industry causes price to

• A) rise from $4 to $6 per unit and output to fall from 200 to 100 units.
• B) fall from $6 to $4 per unit and output to rise from 100 to 200 units.
• C) rise from $4 to $5 per unit and output to fall from 200 to 150 units.
• D) fall from $5 to $4 per unit and output to rise from 150 to 200 units.
• E) fall from $7 to $4 per unit and output to rise from 150 to 300 units.

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Definitions:

Demand Curve

A graphical representation showing the relationship between the price of a good or service and the quantity demanded by consumers, typically downward sloping.

Quantity Demanded

The amount of a product or service consumers are willing and able to buy at a particular price.

Money Income

Refers to the total amount of monetary earnings or receipts accruing to an individual or entity over a period, including wages, salaries, benefits, and income from investments.

Income Effect

The variation in a person's or an economy's earnings and its effect on the amount of a product or service that is requested.