A Single-Price Monopolist Is Producing 8,000 Units of Output

question 108

Multiple Choice

A single-price monopolist is producing 8,000 units of output.At that level,price equals $10,average total cost equals $12,and average variable cost equals $8.In addition,both marginal cost and marginal revenue equal $6.Which of the following statements is correct in the short run?

• A)The firm is earning total revenues equal to $96,000.
• B)The firm could reduce its loss by shutting down.
• C)The firm has a loss per unit equal to $4.
• D)The firm is minimizing its economic loss at $16,000.
• E)The firm is earning an economic profit equal to $16,000.

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Definitions:

Corporate Boards

A group of individuals elected by shareholders to oversee the management and governance of a corporation.

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A metaphor for the invisible barriers that prevent certain groups from achieving higher ranks in organizations, especially affecting women and minorities.

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