In Exhibit 9-7, how much profit is the monopoly earning at the profit-maximizing quantity?
A monopolist earning short-run economic profit determines that at its present level of output, marginal revenue is $23 and marginal cost is $30. Which of the following should the firm do to increase profit?
Raise price and lower output.
Which of the following is not true of a pure monopoly?
It is a price taker
Gilligan runs the only dry-cleaning business on a desert isle. If the cost of cleaning fluid falls, he can increase profit by
In the short run, a monopolist will always shut down when
total variable cost is greater than total revenue at all output levels
A monopolist has no supply curve because
as demand changes, each output level can be consistent with more than one profit-maximizing price
Which of the following statements is true of a monopolist?
The firm might earn a profit in the long run.
What is true at the profit-maximizing quantity for a nondiscriminating monopolist but not true of a perfectly competitive firm?
Price is greater than marginal cost.
Exhibit 9-15 depicts a non-discriminating monopoly market. Consumer surplus is represented by area
In Exhibit 9-15, deadweight loss to consumers from a monopolist that does not price discriminate is represented by area
A profit-maximizing monopolist produces an output level that is allocatively inefficient because