When a Monopolist Increases the Amount of Output That It

question 660

Multiple Choice

When a monopolist increases the amount of output that it produces and sells, the price of its output

• A)stays the same.
• B)increases.
• C)decreases.
• D)may increase or decrease depending on the price elasticity of demand.

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Definitions:

Par Value

The face value of a bond or the stock value stated in the corporate charter, which is the minimum legal capital per share.

Dividend

A portion of a company's earnings distributed to shareholders, representing a share of the corporate profits.

Noncumulative Preferred Stock

A type of preferred stock where missed dividend payments are not accumulated. Investors are not entitled to claim missed dividends in the future.

Par Common Stock

The face value of common stock as stated in the corporate charter; often a nominal amount that has no relation to its market price.