A Monopolist Should Shut Down in the Short Run If

question 132

Multiple Choice

A monopolist should shut down in the short run if

• A)price is less than average variable cost
• B)price is greater than average total cost
• C)marginal revenue equals marginal cost
• D)marginal revenue is less than marginal cost
• E)price exceeds average fixed cost

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Definitions:

Failure To Maintain

A situation where the required level of upkeep, documentation, or regulatory compliance has not been sustained.

Machine Breakdowns

Occurrences when machinery fails or malfunctions, potentially halting production processes and incurring additional costs for repairs.

Sales Orders

Official written documents received by a company from a customer, indicating the type, quantity, and agreed prices for products or services.

Variable Factory Overhead Controllable Variance

The difference between the budgeted variable overhead based on actual production activities and the actual variable overhead incurred.