Reference: Ref 14-1 (Figure: Monopolist) Refer to the Figure

question 10

Multiple Choice

Reference: Ref 14-1 (Figure: Monopolist) Refer to the figure. Based on the demand curves for a monopolist's product in two different markets- Market A and Market B-through the process of price discrimination, how much profit is the monopolist making in Market A?

• A) $270
• B) $450
• C) $830
• D) $627.50

---

Definitions:

Step-Down Method

An allocation method used in cost accounting to distribute overhead costs to various departments in a sequential order based on the level of service provided.

Service Department Costs

Costs incurred by departments that do not directly generate revenue, but support those that do.

Operating Departments

Units within an organization directly involved in producing goods or providing services, as opposed to administrative divisions.

Personnel Costs

Expenses related to the compensation of employees, including salaries, benefits, and taxes.