A Monopolist Is Producing at an Output Level at Which

question 9

Multiple Choice

A monopolist is producing at an output level at which ATC = $5, P = $6, MC = $4, and MR = $3. We can conclude that

• A) economic profit could be increased by producing more.
• B) economic profit could be increased by producing less.
• C) economic profit cannot be increased.
• D) the firm is earning $10 in economic profits.

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Definitions:

Gestalt

A theory that proposes objects are viewed holistically, emphasizing the whole is greater than the sum of its parts.

Behavioral

Pertaining to observable actions or responses in humans or animals.

Psychoanalytic

Pertaining to a psychological theory and therapeutic method developed by Sigmund Freud, focusing on unconscious motives and conflicts.

Humanistic

A psychological perspective focusing on individual potential and stress on the importance of growth and self-actualization.