Which of the Following Is True of Marginal Revenue for a Monopolist

question 104

Multiple Choice

Which of the following is true of marginal revenue for a monopolist that charges a single price?

• A) P = MR because there are no close substitutes for the monopolist's product.
• B) P > MR because the monopolist must decrease price on all units sold in order to sell an additional unit.
• C) P < MR because the monopolist must decrease price on all units sold in order to sell an additional unit.
• D) P = MR only at the profit-maximizing quantity.

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Definitions:

Corporate Constituency Statutes

A statute that expands the traditional view that directors and officers of a corporation have a duty to make business decisions primarily or exclusively to maximize shareholders’ interests by explicitly permitting the consideration of non-shareholder interests. Those interests may vary but often include the environment, corporate employees, customers, creditors, suppliers, and local community.

Raiders

Individuals or entities that aggressively attempt to take over or acquire control of a business, often through purchasing a substantial portion of its stock.

Corporate Books

The official records of a corporation, documenting essential activities, decisions, and financial transactions.

Freeze-Out Acquisition

A strategy used in mergers and acquisitions where a majority shareholder forces out minority holders to take full control of the company.