Firm marginal revenue is more than its marginal cost

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Reference no: EM131393436

1. If a firm's Marginal Revenue (MR) is more than its Marginal Cost (MC) at any given level of production (Q), profit-maximization requires that the perfectly competitive firm (decrease/not change/increase) its product price and the monopoly producer (decrease/not change/increase) its product price.

A. Not change; decrease. B. Decrease; decrease. C. Decrease; not change. D. Not change; increase. E. Increase; increase.

2. When the price of product "X" was (P=) $10 apiece, Chad purchased seven units (QD=7) and when the price of product "X" increases to (P=) $25 apiece, Chad continues to purchase seven units (QD=7). With this information we can determine that Chad's demand for product "X" is:

A. "Unitary elastic" in this price range. B. "Perfectly inelastic" in this price range. C. "Relatively inelastic" in this price range. D. "Perfectly elastic" in this price range. E. "Relatively elastic" in this price range.

Reference no: EM131393436

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