A Monopolist Faces a Constant Marginal Cost of $1 Per

question 8

Multiple Choice

A monopolist faces a constant marginal cost of $1 per unit and has no fixed costs.If the price elasticity of demand for this product is constant and equal to -4, then

• A)to maximize profits, he should charge a price of $4.
• B)he is not maximizing profits.
• C)to maximize profits, he should charge a price of $1.33.
• D)to maximize profits, he should charge a price of $1.25.
• E)None of the above.

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Definitions:

Species Taxa

The basic unit of classification in biological taxonomy, used to group individuals that are capable of interbreeding.

Scientists

Individuals engaged in systematic activity to acquire knowledge involving observation and experimentation in the field of natural sciences.

Ecological Role

The function or position of a species within an ecological community, determining how it contributes to the ecosystem structure and function.

Diagnostic Features

Characteristics or attributes used to identify, categorize, or diagnose conditions, diseases, or materials based on specific criteria.