If One Firm in a Duopoly Increases Its Production by One

question 211

Multiple Choice

If one firm in a duopoly increases its production by one unit beyond the monopoly output,that firm's profit ________,the other firm's profit ________,and the total profit of the duopoly ________.

• A) increases; increases; increases
• B) does not change; does not change; does not change
• C) increases; decreases; does not change
• D) increases; does not change; increases
• E) increases; decreases; decreases

---

Definitions:

Less than Six Months

A term used to describe a period or duration that does not exceed six months.

More than One Year

Refers to a time frame in accounting and finance that indicates durations or periods extending beyond a twelve-month or one-year period.

Transaction Analysis

The process of studying a transaction to determine its economic effect on the business in terms of the accounting equation.

Accounting Equation

The foundational principle of double-entry bookkeeping, stating that assets equal liabilities plus shareholders' equity.