Answer to Question #41543 in Microeconomics for Manisha
Assume that a monopoly has a linear demand curve. If It is charging the profit maximizing price, will the demand for its product at that price be elastic or inelastic? Explain fully
The demand will be inelastic, as there is only one producer. And if it changes the price, the quantity demanded will not change significantly, because there is no other producer with lower price.