Compared to the Situation in Which It Sets a Single

question 38

Multiple Choice

Compared to the situation in which it sets a single price,a monopoly that price discriminates ________ its economic profit and ________ its output.

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

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Definitions:

Synthetic Grease

A lubricant made from chemical compounds that does not contain petroleum, designed to reduce friction and wear on various types of machinery.

Financial Break-even

The point at which total revenue equals total costs and expenses, resulting in no net loss or gain.

Variable Costs

Expenses that vary directly with the volume of production or the degree of activity within a company.

Fixed Costs

Costs that do not vary with the volume of production or level of activity within a certain range. These are expenses that must be paid regardless of business activity, such as rent or salaries.