A monopolist is producing at an output level at which MR = $6 and MC = $9. It could increase profits
A) by increasing both output and price.
B) by reducing output and by increasing price.
C) by reducing both output and price.
D) by increasing output and by reducing price.
B
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Use the following table, which shows the aggregate demand and aggregate supply schedule for a hypothetical economy, to answer the next question.Real Domestic Output Demanded (in billions)Price Level (index value)Real Domestic Output Supplied (in billions)$500350$3,5001,0003003,0001,5002502,5002,0002002,0002,5001501,5003,0001001,000If the quantity of real domestic output demanded increased by $1,000 at each price level, the new equilibrium price level and quantity of real domestic output would be ________.
A. 150 and $2,500 B. 300 and $3,000 C. 250 and $2,500 D. 200 and $2,000
The substitution of one good for another by consumers:
A. is not captured by the CPI. B. is captured by the CPI. C. due to price changes is captured by the CPI. D. due to changes in tastes/preferences is captured by the CPI.