Suppose When a Monopolist Produces 75 Units Its Average Revenue

question 486

Multiple Choice

Suppose when a monopolist produces 75 units its average revenue is $10 per unit, its marginal revenue is $5 per unit, its marginal cost is $6 per unit, and its average total cost is $5 per unit. What can we conclude about this monopolist?

• A)The monopolist is currently maximizing profits, and its total profits are $375.
• B)The monopolist is currently maximizing profits, and its total profits are $300.
• C)The monopolist is not currently maximizing profits; it should produce more units and charge a lower price to maximize profits.
• D)The monopolist is not currently maximizing profits; it should produce fewer units and charge a higher price to maximize profits.

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Definitions:

Affective Component

This component refers to the emotional or feeling segment of an attitude or psychological state, influencing mood and emotional responses.

Proud

Feeling deep satisfaction or pleasure from one's own achievements, the achievements of those one is closely associated with, or from qualities or possessions that are widely admired.

Provincial Capital

The city designated as the administrative capital or seat of government of a province.

Persuasion

The process of influencing someone's beliefs, attitudes, intentions, motivations, or behaviors through communication.