Author Question: If a monopolist is producing a rate of output at which market demand is inelastic, a. it may or may ... (Read 81 times)

Mollykgkg · **on:** Jun 30, 2018

If a monopolist is producing a rate of output at which market demand is inelastic,
a. it may or may not be maximizing its short-run profit
b. reducing output would reduce both total revenue and total cost
c. reducing output would increase both total revenue and total cost
d. reducing output would increase total revenue and reduce total cost
e. increasing output will increase its short-run economic profit

Question 2

Natural monopolies are firms that
a. have a downward-sloping long-run average cost curve over the entire range of market demand
b. have an upward-sloping long-run average cost curve over the entire range of market demand
c. are protected against the entry of new firms by patents, licenses, or other legal restrictions
d. control a nonreproducible resource that is critical to production
e. have been created over time by the mergers of many smaller firms