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For a Monopolist Facing a Downward-Sloping Average Cost Curve,under Cost-Plus

Question 121

Multiple Choice

For a monopolist facing a downward-sloping average cost curve,under cost-plus regulation,there is an incentive for this monopolist to

A) raise market price.
B) increase output.
C) reduce the cost of production even further.
D) set price equal to marginal cost.
E) inflate costs.

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