Advertising by the monopolist
A)is not done because the monopolist has the only supply of the product and doesn't need to advertise.
B)would have the effect of shifting its demand curve to the left.
C)may lead to expanded production by the monopolist.
D)makes no sense because there are no substitute commodities available to consumers.

Question

Quizplus · Accepted Answer

Advertising may increase demand and lead to expanded production by the monopolist, as they may want to take advantage of the increased demand and make more profits. This is especially true if the monopolist has excess capacity or can increase production without incurring too many additional costs. Therefore, the monopolist may choose to advertise even if they have no close substitutes or competitors.

Advertising by the Monopolist