Which of the Following Best Explains Why a Monopolist's Marginal

question 3

Multiple Choice

Which of the following best explains why a monopolist's marginal revenue is less than the sale price?

• A) To sell more units, a monopolist must increase the price on all units sold.
• B) As a monopolist expands output, its average total cost declines.
• C) When a firm has a monopoly, consumers have no choice other than to pay the price set by the monopolist.
• D) When a monopolist reduces price in order to sell more units, it must lower the price of some units that could otherwise have been sold at a higher price.