0quiz6_2015.doc - Multiple choice Identify the letter of...

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Multiple choice Identify the letter of the choice that best completes the statement or answers the question. The following three questions refer to the accompanying diagram 1. When a simple monopolist – no price discrimination - chooses to reduce sales by one unit of a good or service Use the table below of numbers to answer the following two questions. You do not need to compute all the empty cells! Quantity Price Total Revenue Average Revenue Marginal Revenue 1 35 35 2 64 32 29 3 29 4 17 5 23 11 6 120 7 17 -1 8 -7 9 99 11 -13 2. Refer to the table. If the monopolist wants to maximize its revenue, how many units of its product should it sell? 3. Refer to the table. Assume this monopolist's marginal cost is constant at $5. What quantity of output (Q) will it produce and what price (P) will it charge?
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