Answer to Question #70248 in Microeconomics for ephraim

Question #70248
lonewolf ltd is the sole manufacturer and supplier of solar panels in the country. as a result of this the CEO claimed in a recent meeting that he can set any price he wishes and sell as many units of his product as he wants at that price. is this correct? motivate your answer
1
Expert's answer
2017-09-26T09:45:07-0400
CEO is mistaken, since the quantity of units sold at a certain price is still determined by the demand curve, which has a downward character. At the same time, solar panels are not a basic commodity, so the demand for them will be elastic, i.e. with an increase in the price, the quantity of units sold will decrease to a greater extent, and the total revenue will fall.

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