Use the following to answer questions: Table: Profit-Maximizing Monopolist $$\begin{array} { c c c c c c c }
\hline \begin{array} { c }
\text { Quantity } \
\text { Price (\$) }
\end{array} & \begin{array} { c }
\text { Total } \
\text { (Units) }
\end{array} & \begin{array} { c }
\text { Average } \
\text { Cost (\$) }
\end{array} & \begin{array} { c }
\text { Average } \
\text { Cost (\$) }
\end{array} & \begin{array} { c }
\text { Marginal } \
\text { Revenue (\$) }
\end{array} & \begin{array} { c }
\text { Marginal } \
\text { Cost (\$) }
\end{array} & \text { Revenue (\$) } \
\hline 11 & 6 & 17 & & & \
10 & 7 & 19 & & & \
9 & 8 & 21 & & & \
8 & 9 & 23 & & & \
7 & 10 & 25 & & & \
\hline
\end{array}$$
-(Table: Profit-Maximizing Monopolist) Refer to the table. When this monopolist is producing 9 units,:
A) its marginal cost is below the marginal revenue level.
B) its average revenue is greater than the price it receives for the product.
C) it could increase its profit by raising the price and selling fewer units.
D) it is producing at the socially optimal level.

Question

Use the following to answer questions: Table: Profit-Maximizing Monopolist $$\begin{array} { c c c c c c c } 
\hline \begin{array} { c } 
\text { Quantity } \
\text { Price (\$) }
\end{array} & \begin{array} { c } 
\text { Total } \
\text { (Units) }
\end{array} & \begin{array} { c } 
\text { Average } \
\text { Cost (\$) }
\end{array} & \begin{array} { c } 
\text { Average } \
\text { Cost (\$) }
\end{array} & \begin{array} { c } 
\text { Marginal } \
\text { Revenue (\$) }
\end{array} & \begin{array} { c } 
\text { Marginal } \
\text { Cost (\$) }
\end{array} & \text { Revenue (\$) } \
\hline 11 & 6 & 17 & & & \
10 & 7 & 19 & & & \
9 & 8 & 21 & & & \
8 & 9 & 23 & & & \
7 & 10 & 25 & & & \
\hline
\end{array}$$
-(Table: Profit-Maximizing Monopolist) Refer to the table. When this monopolist is producing 9 units,:
A) its marginal cost is below the marginal revenue level.
B) its average revenue is greater than the price it receives for the product.
C) it could increase its profit by raising the price and selling fewer units.
D) it is producing at the socially optimal level.

Quizplus · Accepted Answer

The monopolist could increase profit by raising the price and selling fewer units because it is likely producing where marginal cost is less than marginal revenue, indicating that reducing output could increase profit.

Use the Following to Answer Questions: Table: Profit-Maximizing Monopolist -(Table: Profit-Maximizing Monopolist) Refer to the Table