Author Question: If a monopolist is forced to set price equal to average total cost, economic profit a. will be ... (Read 40 times)

james9437 · **on:** Jun 30, 2018

If a monopolist is forced to set price equal to average total cost, economic profit
a. will be negative, and the monopolist may go out of business
b. will be zero
c. will be positive
d. will be negative, and the firm will stay in business if there are significant fixed costs
e. may be positive, negative, or zero

Question 2

In the short run, a perfectly competitive firm will always shut down if, at all positive output levels, total revenue is
a. less than total cost
b. less than total cost but greater than variable cost
c. less than total cost but greater than fixed cost
d. greater than fixed cost
e. less than variable cost