A Profit-Maximizing Monopolist Faces a Downward-Sloping Demand Curve That Has

question 54

Multiple Choice

A profit-maximizing monopolist faces a downward-sloping demand curve that has a constant elasticity of -3. The firm finds it optimal to charge a price of $12 for its output. What is its marginal cost at this level of output?

• A) $5
• B) $25
• C) $24
• D) $8
• E) $12

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Definitions:

Minimum Effect Concentration (MEC)

The lowest concentration of a drug that produces the desired therapeutic effect without causing adverse effects.

Toxic Level

The concentration of a substance in the body that can cause harmful effects or poisoning.

Plasma

The liquid component of blood, in which blood cells are suspended, consisting of water, salts, and proteins.

Iron Supplement

A dietary supplement used to increase the amount of iron in the body, often prescribed for anemia.