The Demand for a Monopolist's Output Is 7,000 Divided by the Square

question 6

Multiple Choice

The demand for a monopolist's output is 7,000 divided by the square of the price in dollars that it charges per unit.The firm has constant marginal costs equal to 1 dollar per unit.To maximize its profits, it should charge a price of

• A)1 dollar.
• B)2 dollars.
• C)3 dollars.
• D)1.5 dollars.
• E)2.5 dollars.

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