Columns 1 and 2 Make Up a Portion of a Monopolist's

question 12

Multiple Choice

Columns 1 and 2 make up a portion of a monopolist's production function for a single variable input,labor.Columns 2 and 3 represent the demand function facing the monopolist over this range of output: $\begin{array}{c}\begin{array}{c}(1) \\\text {Units of Labor}\\3 \\4 \\5 \\6 \\7\end{array}\begin{array}{c}(2) \\\text {Units of Output}\\370 \\490 \\570 \\600\\620\end{array}\begin{array}{c}(3) \\\text {Price}\\\$10\\9\\8\\7\\6\end{array}\end{array}$
How much does the fifth unit of labor add to the firm's total revenue?

• A)$1.875
• B)$80
• C)$150
• D)$4,560
• E)none of the above

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Definitions:

Concentration Ratio

A measurement of the market share or output controlled by the largest firms within an industry, used to assess the level of competition.

Costly to Ship

Refers to items or materials that are expensive to transport, typically because of their weight, size, or special handling requirements.

Degree of Monopoly

Measures the level of market control and price-setting power possessed by a monopolist.

Very Localized

Referring to something that is confined to a very small or specifically defined geographic area or community.