If a Certain Market Were a Monopoly, Then the Monopolist

question 89

Multiple Choice

If a certain market were a monopoly, then the monopolist would maximize its profit by producing 4,000 units of output. If, instead, that market were a duopoly, then which of the following outcomes would be most likely if the duopolists successfully collude?

• A)Each duopolist produces 4,000 units of output.
• B)Each duopolist produces 1,500 units of output.
• C)One duopolist produces 2,400 units of output and the other produces 1,600 units of output.
• D)One duopolist produces 3,000 units of output and the other produces 1,500 units of output.

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Definitions:

Experimentation

The process of conducting trials to explore hypotheses or understand phenomena through controlled variation of conditions.

Deming

Refers to W. Edwards Deming, a prominent figure in the field of quality management who introduced concepts such as the Plan-Do-Check-Act (PDCA) cycle.

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