If a Monopolist Is Forced to Set Price Equal to Average

question 112

Multiple Choice

If a monopolist is forced to set price equal to average total cost, economic profit

• A)will be negative, and the monopolist may go out of business
• B)will be zero
• C)will be positive
• D)will be negative, and the firm will stay in business if there are significant fixed costs
• E)may be positive, negative, or zero

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Definitions:

Strivings

Persistent efforts or endeavors towards achieving long-term goals or fulfilling needs.

Expectancies

Expectancies are beliefs about the likelihood of future events happening, which can influence behavior and outcomes.

Current Concern

A present matter or interest that occupies an individual's attention and thought.

Incentive

Something that motivates or encourages an individual to take action or endeavor to achieve a certain goal.