Suppose a lazy monopolist's fixed costs are higher than the fixed costs of an efficient monopolist. In all other respects the monopolists are the same. Which of the following statements about this lazy monopolist is true?
A) Its total profit is lower than that of the monopolist producing efficiently.
B) Its total profit is the same as that of the monopolist producing efficiently.
C) Its total revenue is less than that of the monopolist producing efficiently.
D) It produces less than does the monopolist producing efficiently.

Question

Quizplus · Accepted Answer

The lazy monopolist has higher fixed costs, which reduces its total profit compared to an efficient monopolist with lower fixed costs, assuming all other factors are equal.

Suppose a Lazy Monopolist's Fixed Costs Are Higher Than the Fixed