An increase in a monopoly's fixed costs would cause its output to
A)rise.
B)fall.
C)stay the same.
D)impossible to predict.

Name: An increase in a monopoly's fixed costs would cause its output to A)rise. B)fall. C)stay the same. D)impossible to predict.
Brand: Quizplus
Rating: 4.8 (39 reviews)

Question

Quizplus · Accepted Answer

In a monopoly, fixed costs do not affect the marginal cost of production, which is what determines the profit-maximizing level of output. Therefore, an increase in fixed costs would not change the monopoly's output.

An Increase in a Monopoly's Fixed Costs Would Cause Its