If a Profit Maximizing Monopolist Faces a Linear Demand Curve

question 47

Multiple Choice

If a profit maximizing monopolist faces a linear demand curve and has zero marginal cost, it will produce where demand elasticity is __________________ if it will produce at all.

• A)inelastic
• B)elastic
• C)1
• D)Information is inadequate to answer the question.

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Definitions:

Market Forces

The natural dynamics of supply and demand that determine the prices and availability of goods and services in an economy without external influences.

Comparisons

The act or instance of examining the similarities and differences between two or more items.

Same Industry

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