Whenever the largest firm in a concentrated industry breaks into two equal sized parts, the four firm concentration ratio ___ and the Herfindahl-Hirschman Index ____:
a. Will fall; will fall
b. Will fall; may fall or stay the same.
c. May fall or stay the same; will fall.
d. May fall or stay the same; May fall or stay the same.
a
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Assume a firm is facing the following situation: At Q = 1,000, P = $10, MC = $10, ATC = $18, and AVC = $16. This firm should shut down and, in so doing, limit its losses to $2,000
Indicate whether the statement is true or false
Exhibit 8-7 Monopolist
?
According to the information provided in Exhibit 8-7, if the Rudd Ice Company is a monopoly and is currently charging a price of $6, what would you advise Rudd to do?
A. Stay where he is currently operating because he is charging the profit maximizing price. B. Increase price and decrease output. C. Decrease price and increase output. D. Increase output and hold price constant.