1. A price-discriminating monopoly sells a larger quantity than it would if it w
ID: 1161879 • Letter: 1
Question
1. A price-discriminating monopoly
sells a larger quantity than it would if it were a single-price monopoly.
is illegal.
cannot offer discounts.
cannot control the price of its product.
makes a smaller economic profit than it would if it were a single-price monopoly.
2. Assume someone organizes all farms in the nation into a single-price monopoly. As a result, the price consumers pay for food
does not change, that is, it remains constant.
falls.
rises.
might rise or fall depending on whether the demand for food is elastic or inelastic.
might rise or fall depending on whether the monopoly's marginal revenue curve lies above or below its demand curve.
sells a larger quantity than it would if it were a single-price monopoly.
is illegal.
cannot offer discounts.
cannot control the price of its product.
makes a smaller economic profit than it would if it were a single-price monopoly.
Explanation / Answer
1)
Right answer is " sells a larger quantity than it would if it were a single-price monopoly"
Discriminatory monopoly tends to supply more output but it make all efforts to corner maxmimum surplus from consumers.
2)
Right answer is "
might rise or fall depending on whether the demand for food is elastic or inelastic.
If demand is elastic, then there would be disproportionate fall in the demand if price is increased. Hence, in such situation monopoly can not increase price. thus monopoly competition can not always effect rise in price level.
might rise or fall depending on whether the demand for food is elastic or inelastic.
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