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Homework answers / question archive / The monopoly's supply curve: a) shows how quantity supplied rises as price rises b) is found at the point of intersection of the MR and MC curves c) is a single point on its demand curve d) is accurately described by none of the listed options e) looks the same as that for a perfectly competitive firm, though their demand curves differ
The monopoly's supply curve:
a) shows how quantity supplied rises as price rises
b) is found at the point of intersection of the MR and MC curves
c) is a single point on its demand curve
d) is accurately described by none of the listed options
e) looks the same as that for a perfectly competitive firm, though their demand curves differ
The monopoly's supply curve shows how quantity supplied rises as price rises. (option a)
The supply curve has a positive slope as the producer will be keen on selling more quantity of a particular good if the price increases. This is an obvious choice for the firm as the firm will receive more average revenue. When the price of the commodity increases, the firm will eventually have more money that it will invest in the production process. Hence, in accordance to Marshall's law of supply { the price is the cause (independent variable) and quantity supplied is the effect (dependent variable) }, the price affects the quantity supplied by a firm.
