Given a Monopolist Is the Sole Producer in a Market

question 149

Multiple Choice

Given a monopolist is the sole producer in a market, it is able to change the price of its product:
(i) without affecting the quantity sold
(ii) by adjusting the quantity it supplies to the market
(iii) but its profit could increase or decrease as a result

• A)(ii) only is true
• B)(i) and (ii) are true
• C)(ii) and (iii) are true
• D)(i) and (iii) are true

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Definitions:

Markup Per Unit

The sum added to the purchase price of products to account for operational costs and earnings.

Variable Cost

Expenses that change in proportion to the activity of a business.

Desired Profit

The target profit a company sets to achieve in a specific period.

Cost Concept

A concept of accounting that determines the amount initially entered into the accounting records for purchases.