In response to an increase in demand, a monopoly firm would probably _______ price and _______ quantity.
A) increase; decrease
B) increase; increase
C) decrease; increase
D) decrease; decrease

Question

Quizplus · Accepted Answer

In response to an increase in demand, a monopoly firm would likely increase the price due to the higher willingness to pay among consumers, and increase the quantity supplied to meet the higher demand.

In Response to an Increase in Demand, a Monopoly Firm