Which of the Following Best Explains Why a Monopolist's Marginal

question 123

Multiple Choice

Which of the following best explains why a monopolist's marginal revenue is less than the sale price?

• A) To sell more units, a monopolist must increase the price on all units sold.
• B) To sell more units, a monopolist must lower the price of some units that could otherwise have been sold at a higher price.
• C) When a firm has a monopoly, consumers have no choice other than to pay the price set by the monopolist.
• D) As a monopolist expands output, its average total cost declines.

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Definitions:

Brazil

A country in South America known for its vast Amazon rainforest, vibrant culture, and populous cities.

Rio de Janeiro

A major city in Brazil known for its Copacabana and Ipanema beaches, the giant statue of Christ the Redeemer atop Mount Corcovado, and its colorful Carnival festival.

Peripheral Model

A theory in urban sociology suggesting that urban areas are composed of an inner city surrounded by large suburban residential and business areas tied together by a beltway or ring road.

Concentric Zones

A sociological model that divides cities into circular areas with varying social characteristics, originating from the work of Ernest Burgess.