Suppose That a Single- Price Monopolist Knows the Following Information

question 70

Multiple Choice

Suppose that a single- price monopolist knows the following information: $\begin{array}{|l|l|l|l|l|l|l|l|}\hline \text { Price } & \text { Quantity } & \text { TR } & \text { MR } & \text { Fixed Cost } & \text { TC } & \text { ATC } & \text { MC } \\\hline \$ 5.00 & 2000 & & \$ 4.00 & \$ 2000 & & \$ 5.00 & \$ 3.00 \\\hline\end{array}$ The monopolist could maximize profits in the short run by

• A)lowering price and leaving output unchanged.
• B)shutting down.
• C)staying at the current price and output.
• D)raising price and lowering output.
• E)lowering price and increasing output.

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Definitions:

Demand

The quantity of a product or service that consumers are willing and able to purchase at various prices during a certain period of time.

Multiple Products

Refers to a range of different items or SKUs that a company produces or sells.

Postponement

A strategy in logistics and supply chain management that delays product customization until customer orders are received, to reduce inventory and improve responsiveness.

Overall Profits

The total financial gains made by a company after all expenses and costs have been subtracted from total revenues.