Question #52943

1. A monopolist always faces a demand curve that is:
a. perfectly inelastic.
b. perfectly elastic.
c. unit elastic.
d. the same as the entire market demand curve.
2. There is only one gas station within hundreds of miles. The owner finds that when she charges $3 a gallon, she sells 199 gallons a day, and when she charges $2.99 a gallon, she sells 200 gallons a day. The marginal revenue of the 200th gallon of gas is:
a. $.01.
b. $1.
c. $2.99.
d. $3.
e. $600.
3. A monopolist earns an economic profit only when:
a. average total cost equals than price.
b. marginal cost equals price.
c. marginal revenue equals price.
d. average total cost is less than price.

Expert's answer

d. the same as the entire market demand curve.

b. $1.

a. average total cost equals than price.

b. $1.

a. average total cost equals than price.

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