Question:

A monopolist produces 14,000 units of output and charges Rs.14 per unit. Its marginalrevenue is Rs.8, its marginal cost is Rs.7 and rising, its average total cost is Rs.10, and its average variable cost is Rs.9. The monopolist should

A.

increase curve output, which will result in an increase in the firm\s positive economic profit

B.

increase output, which will reduce the firm\s economic losses

C.

shut down, which will reduce the firm\s economic losses

D.

decrease output, which will result in an increase in the firm\s positive economic

Answer» a. increase curve output, which will result in an increase in the firm\s positive economic profit