Figure 11-8 -Given the Average Cost Curve Shown in Figure 11-8 for Figure

question 92

Multiple Choice

Figure 11-8
-Given the average cost curve shown in Figure 11-8 for dry cleaning, where Q₁ is the quantity demanded in a small town, and Q₂ for a larger town, you would expect dry cleaning to be a monopoly

• A)in a small town, but not a large one.
• B)in both large and small towns.
• C)in a large town, but not a small one.
• D)only if the process is patented.

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Definitions:

Price Increase

A rise in the cost of goods or services, which can occur due to various factors including increased production costs, higher demand, or inflation.

Optimal Bundle

The combination of goods and services that maximizes an individual's utility given their budget constraint.

Original Prices

The initial cost or value of goods and services before any discounts, markdowns, or adjustments.

Utility Function

A mathematical representation in economics that reflects consumer preferences, assigning a value to each possible bundle of goods.