As a Monopolist's Demand Curve Becomes More Inelastic

question 82

Multiple Choice

As a monopolist's demand curve becomes more inelastic,:

• A)the profit-maximizing price goes up.
• B)the profit-maximizing price goes down.
• C)the optimal mark-up of price over marginal cost goes down.
• D)average revenue falls.

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Definitions:

Diffusion of Innovation

An idea focused on elucidating the processes, causes, and velocities at which new technologies and concepts proliferate across cultures.

Late Majority

A segment of a product adoption cycle referring to individuals who adopt new technology or products after the average member of society.

Diffusion of Innovation

A theory that explains how, why, and at what rate new ideas and technology spread through cultures, from early adopters to the broader population.

Laggards

Individuals or groups that are last to adopt an innovation or change, typically resistant to alterations in status quo.