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Assume That a Firm's Marginal Cost Is $10 and the Elasticity

Question 120

Multiple Choice

Assume that a firm's marginal cost is $10 and the elasticity of demand is -2. We can conclude that the firm's profit maximizing price is approximately:


A) $20.
B) $5.
C) $10.
D) The answer cannot be determined without additional information.

Correct Answer:

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