Q614
A monopolist produces 14,000 units of output and charges Rs. 14 per unit. Its marginal revenue is Rs. 8, its marginal cost is Rs. 7 and rising, its average total cost is Rs. 10, and its average variable cost is Rs. 9. The monopolist should
A.
Increase output, which will increase the firm's positive economic profit
AnswerB.
Increase output, which will reduce the firm's economic losses
C.
Shut down, which will reduce the firm's economic losses
D.
Decrease output, which will increase the firm's positive economic profit
Answer: Option A
Solution
Answer: Option A
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