If a Monopolist Wishes to Increase Its Output and Quantity

question 160

Multiple Choice

If a monopolist wishes to increase its output and quantity sold

• A) it must reduce its price, so its marginal revenue is greater than its price.
• B) it must reduce its price, so its marginal revenue is less than its price.
• C) it must raise its price, so its marginal revenue is greater than its price.
• D) it must raise its price, so its marginal revenue is less than its price.

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Definitions:

Private Property

Land or belongings owned by an individual or group, legally protected by laws of the jurisdiction in which it is located.

Contracting Power

The authority granted to entities, often within the government, to enter into legal agreements or contracts, often for procurement or services.

Government Agencies

Organizations at the federal, state, or local level that implement and manage specific government policies and programs.

Federal Funds Rate

The interest rate at which depository institutions lend reserve balances to other depository institutions overnight, a key economic policy tool used by the Federal Reserve.