If a Monopolist That Does Not Practice Price Discrimination Is

question 160

Multiple Choice

If a monopolist that does not practice price discrimination is operating at an output level where price equals average total cost,we can conclude that _____

• A)its economic profit is $0.
• B)it is not maximizing profit.
• C)it should go out of business in the long run.
• D)it is not earning a normal profit.
• E)it should shut down in the short run.

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Definitions:

Finishing Department

The final stage in a manufacturing process where products undergo final touches, treatments, or packaging before being ready for sale.

Net Profit

The financial gain or loss a business makes after subtracting all expenses, taxes, and costs from total revenue.

Shadow Price

In linear programming, it refers to the value that represents the change in the optimal objective function value per unit increase in the right-hand side of a constraint.

Finishing Constraint

A limitation or requirement in the production process that must be met before a product can be completed and delivered.