If the Monopoly Firm's Marginal Cost Curve Is Either Horizontal

question 133

Multiple Choice

If the monopoly firm's marginal cost curve is either horizontal or upward sloping, it follows that its marginal revenue curve will cut its marginal cost curve at a __________ level of output than where its demand curve cuts its marginal cost curve. It also follows that if the firm were to produce the quantity of output consistent with where its demand curve cut its marginal cost curve, the firm would be __________.

• A)lower; earning profits
• B)lower; resource-allocative efficient
• C)higher; productive efficient
• D)lower; minimizing costs

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Definitions:

Profit Center

A business unit or department within an organization that is responsible for generating its own revenue and profit.

Direct Expenses

Costs that can be directly traced to a product, service, or activity without any need for allocation.

Profit Center

A profit center is a division or branch within a company that is responsible for generating its own revenue and profit, allowing for performance measurement independently.

Uncontrollable Costs

Uncontrollable costs are expenses that cannot be directly managed or influenced by actions of the business or its managers, often due to external factors.