A Reduction in a Monopolist's Fixed Costs Would

question 568

Multiple Choice

A reduction in a monopolist's fixed costs would

• A)decrease the profit-maximizing price and increase the profit-maximizing quantity produced.
• B)increase the profit-maximizing price and decrease the profit-maximizing quantity produced.
• C)not effect the profit-maximizing price or quantity.
• D)possibly increase, decrease or not effect profit-maximizing price and quantity, depending on the elasticity of demand.

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Definitions:

Positive Punishment

Adding an undesirable stimulus to decrease a behavior; for example, scolding a pet to stop it from engaging in unwanted behavior.

Frequency

The rate at which something occurs or is repeated over a particular period of time or in a given sample.

Misbehavior

Actions or conduct that are inappropriate, disruptive, or violate social norms or rules.

Secondary Reinforcers

Stimuli that acquire their reinforcing power through their association with primary reinforcers.