A monopoly is currently producing 2,000 units of output; price is $100, marginal revenue is $80, average total cost is $130, marginal cost is $60, and average variable cost is $60. The firm should

Question

Answer

None of the above.

Answer

keep the price the same because the firm is producing at minimum average variable cost.

Answer

lower price because the next unit of output increases profit by $20.

Answer

raise price because the firm is losing money.

Answer

raise price because the last unit of output decreased profit by $30.

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A monopoly is currently producing 2,000 units of output; price is $100, marginal...

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