If a Monopolist's Marginal Costs Increase by $1 for All

question 60

Multiple Choice

If a monopolist's marginal costs increase by $1 for all levels of output, then the monopoly price will

• A)rise by $1.
• B)rise by more than $1.
• C)rise by less than $1.
• D)not change, but profits will decrease.

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Definitions:

Journal Entries

Records of financial transactions in the order they occur, which are then posted to the appropriate accounts.

Debits

Entries in accounting that increase an asset or expense account, or decrease equity, liability, or revenue accounts.

Credits

Accounting entries that represent an increase in liabilities or revenues, or a decrease in assets or expenses.

Adjusting Entries

Adjusting entries are journal entries made in an accounting period's end to allocate income and expenditures to the period in which they actually occurred.