Author Question: A nondiscriminating monopolist earning positive short-run economic profit determines that its ... (Read 93 times)

mpobi80 · **on:** Jun 30, 2018

A nondiscriminating monopolist earning positive short-run economic profit determines that its current marginal cost is 15 and its current marginal revenue is 20 . To maximize profit, a firm should
a. raise price and increase output
b. raise price and decrease output
c. maintain a constant price and increase output
d. reduce price and increase output
e. shut down

Question 2

A physicians' professional association supports legislation seeking higher quality medical care. According to the special interest theory of regulation, who likely will benefit most from this legislation?
a. Government, through decreased regulation of physician quality.
b. Patients, through reduced prices for medical care.
c. Physicians, through increased prices for medical care.
d. Hospitals, through decreased for physicians' services.
e. Government, since higher quality health care is clearly in the public interest.