To Sell More Units, a Monopolist

question 94

Multiple Choice

To sell more units, a monopolist

• A) simply moves across its horizontal demand curve to a larger quantity.
• B) moves down its demand curve to a lower price that will increase quantity demand.
• C) can continue to receive the same price it always has as long as it has its customers' goodwill.
• D) must be willing to lower the barriers to entry that have protected it.

---

Definitions:

Sales Volume

The total number of units sold within a specific period, often used as an indicator of business performance.

Variable Expense

Costs that change in proportion to the level of production or sales activity.

Contribution Margin Ratio

The percentage of each sales dollar that remains after variable costs have been deducted, indicating how much contributes to fixed costs and profits.

Cost-Volume-Profit Graph

A visual representation that shows the relationship between cost, volume of production, and profit, to analyze how changes in variables affect profits.