Figure 13.1

Figure 13.1 above shows the demand and cost curves facing a monopolist.
-Refer to Figure 13.1.If the firm's average total cost curve is ATC₁, the firm will
A)suffer a loss.
B)break even.
C)make a profit.
D)face competition.

Question

Figure 13.1
  
Figure 13.1 above shows the demand and cost curves facing a monopolist.
-Refer to Figure 13.1.If the firm's average total cost curve is ATC₁, the firm will
A)suffer a loss. 
B)break even. 
C)make a profit. 
D)face competition.

Quizplus · Accepted Answer

If the firm's average total cost curve is ATC₁ and it is below the market price, the firm will make a profit as its costs are lower than the revenue it earns per unit.

Figure 13.1 Figure 13.1 Above Shows the Demand and Cost Curves Facing