In Order for a Monopolist to Earn an Economic Profit

question 52

True/False

In order for a monopolist to earn an economic profit in short-run equilibrium, marginal revenue must be equal to zero.

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Definitions:

FIFO Inventory Method

An accounting method for valuing inventory that assumes the first items purchased are the first to be sold.

Cost Of Goods Sold

The total cost directly associated with producing goods that have been sold, including materials and labor.

Days' Sales

Often part of larger financial metrics, this term by itself is unclear without additional context such as Days' Sales Outstanding (DSO).

Ending Inventory

The final value of goods available for sale at the end of an accounting period, calculated before the start of a new period.