A decrease in the fixed costs of a monopoly firm would _______ quantity and _______ price.
A) increase; increase
B) increase; decrease
C) decrease; increase
D) not change; not change

Question

Quizplus · Accepted Answer

A decrease in fixed costs does not affect the quantity produced or the price set by a monopoly firm, as these decisions are based on marginal costs and demand, not fixed costs.

A Decrease in the Fixed Costs of a Monopoly Firm