Which of the Following Statements About Elasticity Are True for a Monopolist

question 88

Multiple Choice

Which of the following statements about elasticity are true for a monopolist?

• A)when marginal revenue is negative, demand is price elastic
• B)marginal revenue revenue is maximized when elasticity is equal to one
• C)a monopolist's demand curve always income elastic
• D)when marginal revenue is positive, demand is price elastic

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Definitions:

Bilateral Monopoly Wage Rate

refers to the wage rate determined in a market where there is only one employer (a monopoly) and one union or employee (a monopsony), necessitating negotiation to reach an agreement on wages.

Perfectly Inelastic Supply

A market condition where the quantity supplied remains constant regardless of changes in price.

Bargaining Power

The relative capacity of parties in a negotiation to exert influence over each other, affecting the terms of the agreement.

Union Workers

Employees who are members of a labor union, which negotiates collective bargaining agreements on their behalf.