Quick Buck and Pushy Sales Produce and Sell Identical Products

question 31

Multiple Choice

Quick Buck and Pushy Sales produce and sell identical products and face zero marginal and average cost.Below is the market demand and marginal revenue curves for the product.
Refer to the figure above.The profit-maximizing quantity for a monopolist with this demand curve is _____ units,which the monopolist would sell for ______.

• A) 3,000;$1.00
• B) 1,000;$1.50
• C) 2,000;$1.50
• D) 1,000;$2.50

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Definitions:

Average Fixed Costs

Costs that do not vary with the level of output and are averaged over the total number of units produced.

Marginal Costs

The expense associated with manufacturing an extra unit of a product or service.

TVC

The total expenses a firm incurs that increase or decrease with the level of output, essentially another term for total variable costs with a rephrased definition.

AVC

Average Variable Cost, which is the total variable costs divided by the quantity of output produced, reflecting the variable cost per unit.