A Monopolist Achieves the Most Profitable Rate of Output by Applying

question 19

Multiple Choice

A monopolist achieves the most profitable rate of output by applying which of the following rules?

• A) Average variable cost equals price.
• B) Average total cost equals price.
• C) Marginal revenue equals marginal cost.
• D) Average total cost and average variable cost are both at a minimum.

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Definitions:

Nash Equilibrium

A concept in game theory where no player can benefit by changing strategies while the other players keep theirs unchanged.

Dominant Strategy

A strategy in game theory that yields the best outcome for a player, no matter what the opponents choose to do.

Credibility

The quality of being trusted and believed in, often a crucial factor for individuals, organizations, and information sources.

Dominant Strategy

A strategy in game theory that is best for a player to follow regardless of the strategies chosen by other players in the game.