The Table Given Below Shows the Price, Marginal Revenue and Marginal

question 69

Multiple Choice

The table given below shows the price, marginal revenue and marginal cost of a monopolist at different levels of the output. The firm does not incur a fixed cost of production.Table 11.4

-If the monopolist's price happens to be greater than the average-variable cost but less than the average total cost, in the short run the monopolist will:

• A)be forced to shut down to minimize the cost.
• B)operate at a loss.
• C)operate at an economic profit.
• D)operate at a normal profit.
• E)go out of business.

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Definitions:

Income Distribution

The way in which total income is shared among the members of an economy.

Insolvent

A financial state where an individual or organization cannot meet its debt obligations as they come due.

Liabilities

Financial obligations or debts that a company owes to outside parties, which are recorded on the right-hand side of the balance sheet.

Creditors

Individuals, organizations, or entities that have lent money or extended credit to another party, and thus are owed repayment of the principal amount plus any applicable interest or charges.