Monopolists are like perfectly competitive firms in that ______.
a. both maximize profits at the output level where marginal revenue equals marginal cost
b. both could be earning either profits or losses in the short run
c. both are in industries with downward-sloping demand curves
d. all of these are true of both of them
e. both maximize profits at the output level where marginal revenue equals marginal cost and both could be earning either profits or losses in the short run are true of both of them, but not both are in industries with downward-sloping demand curves
Ans: e. both maximize profits at the output level where marginal revenue equals marginal cost and both could be earning either profits or losses in the short run are true of both of them, but not both are in industries with downward-sloping demand curves
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In the short-run, we assume that the money prices of goods and services are
A) temporarily fixed. B) permanently fixed. C) allowed to fluctuate. D) equal to long-run prices. E) fully employed.
When diminishing marginal returns set in, marginal product is
a. positive and increasing b. positive and decreasing c. negative and increasing d. negative and decreasing e. zero