In the short run,the monopolist should continue to produce whenever
A)price is greater than zero
B)price is less than average total cost
C)price is greater than average variable cost
D)price divided by average total cost exceeds the ratio of marginal cost to average cost at the optimal output
E)price is less than average variable cost at the optimal output

Question

Quizplus · Accepted Answer

In the short run, a monopolist should continue to produce as long as the price is greater than the average variable cost, as this means the firm can cover its variable costs and contribute to fixed costs, minimizing losses.

In the Short Run,the Monopolist Should Continue to Produce Whenever