If the Inverse Demand Curve a Monopoly Faces Is P

question 38

Multiple Choice

If the inverse demand curve a monopoly faces is p = 100 - 2Q,and MC is constant at 16,then profit maximization

• A) is achieved when 21 units are produced.
• B) is achieved by setting price equal to 21.
• C) is achieved only by shutting down in the short run.
• D) cannot be determined solely from the information provided.

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Definitions:

Net Worth

The difference between the total assets and total liabilities of an individual or business.

Normative Question

A question that addresses how things should be rather than how they are, often involving subjective judgments and values.

Tax Base

The total amount of assets or income that can be taxed by a government, serving as a critical source of fiscal revenue.

Assets

Resources owned by a business or individual that have economic value and can be converted into cash.