If a Monopolistic Competitor Is Producing an Output for Which

question 145

Multiple Choice

If a monopolistic competitor is producing an output for which marginal revenue is $40 and marginal cost is $32 to maximize profits the firm should

• A)decrease the level of output.
• B)keep the level of output constant.
• C)continue to make $8 per unit.
• D)increase the level of output.

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Definitions:

Probability

Probability is a measure of the likelihood that an event will occur, expressed as a number between 0 and 1, where 0 indicates impossibility and 1 indicates certainty.

Random Phenomenon

An event or a process that cannot be predicted with certainty due to the random nature of its outcomes.

Independent

Pertaining to variables or events that are not influenced by other variables in the context of statistical analysis.

Dependent

Refers to a variable in a psychological experiment that is expected to change as a result of manipulations in the independent variable.