The Inverse Demand Curve for a Monopolist Changes from P

question 136

Multiple Choice

The inverse demand curve for a monopolist changes from P = 200 - 0.25Q to P = 180 - 0.25Q, while the marginal cost of production remains unchanged at a constant $90. After the change in the demand curve, the price falls by _____ and the output falls by _____.

• A) $10; 40 units
• B) $20; 20 units
• C) $30; 40 units
• D) $40; 20 units

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Definitions:

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Jeremiah's Potential Reaction

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