Suppose the Ding-Dong Doorbell Co

Multiple Choice

Suppose the Ding-Dong Doorbell Co., a monopoly, finds that at current production levels marginal revenue is $15 while marginal cost is $10. This company should:

A) make no change in present production level.
B) without further information on average production cost there is no way to determine what actions the company should take.
C) decrease production, as this will allow price and marginal revenue to increase, thereby increasing profits.
D) increase output as this will result in higher profits.