Refer to the accompanying table,which represents the costs and production for a monopolist,to answer the following questions.

-As production increases,the price consumers pay for the good
A) increases and then decreases.
B) decreases and then increases.
C) stays the same.
D) increases.
E) decreases.

Question

Refer to the accompanying table,which represents the costs and production for a monopolist,to answer the following questions.
 
-As production increases,the price consumers pay for the good
A) increases and then decreases. 
B) decreases and then increases. 
C) stays the same. 
D) increases. 
E) decreases.

Quizplus · Accepted Answer

As production increases, the monopolist experiences diminishing marginal returns, resulting in an increase in marginal cost. As marginal cost increases, the monopolist must charge a higher price to maintain profitability. Therefore, the price consumers pay for the good will decrease as production increases.

Refer to the Accompanying Table,which Represents the Costs and Production