If a monopolist faced a downward sloping average cost curve that lies fully above market demand, he will not produce if he can only charge a single per-unit price, but it would also be inefficient for him to produce.
Answer the following statement true (T) or false (F)
False
Rationale: If AC does not lie too far above demand, it is still efficient for production to take place even though a monopolist who can only charge a single per-unit price will not produce. With constant marginal cost,, so long as the recurring fixed costs are not larger than consumer surplus at the output level at p=MC, it is efficient to produce.
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Of all the constant elasticity of substitution social welfare function, only the one with elasticity of infinity will always choose the efficient outcome from a second-best consumption possibility frontier.
Answer the following statement true (T) or false (F)
Explain at least three examples of the public pressure that resulted in the passage of the Sherman Act.