Suppose That a Monopolist Calculates That at Its Present Output

question 31

Multiple Choice

Suppose that a monopolist calculates that at its present output level, marginal cost is $2.00 and marginal revenue is $3.00. The firm could increase profits by

• A)increasing price and decreasing output.
• B)decreasing price and increasing output.
• C)decreasing price and leaving output unchanged.
• D)decreasing output and leaving price unchanged.

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