Table 9.5
$$\begin{array} { c c c }
\text { Quantity } & \text { Price } ( \$ ) & \text { Total Cost (\$) } \
0 & 10 & 10 \
1 & 9 & 12 \
2 & 8 & 19 \
3 & 7 & 23 \
4 & 6 & 31 \
5 & 5 & 46 \
6 & 4 & 69 \
7 & 3 & 99
\end{array}$$
-Refer to Table 9.5.The loss-minimizing output for a non-discriminating monopolist is _____
A)0 units.
B)2 units.
C)3 units.
D)4 units.
E)5 units.

Question

Table 9.5
 $$\begin{array} { c c c } 
\text { Quantity } & \text { Price } ( \$ ) & \text { Total Cost (\$) } \
0 & 10 & 10 \
1 & 9 & 12 \
2 & 8 & 19 \
3 & 7 & 23 \
4 & 6 & 31 \
5 & 5 & 46 \
6 & 4 & 69 \
7 & 3 & 99
\end{array}$$
-Refer to Table 9.5.The loss-minimizing output for a non-discriminating monopolist is _____
A)0 units.
B)2 units.
C)3 units.
D)4 units.
E)5 units.

Quizplus · Accepted Answer

To determine the loss-minimizing output for a non-discriminating monopolist, we need to look for the quantity at which the total cost is the lowest (i.e., the loss is minimized).

From the table, we can see that the total cost is lowest at a quantity of 3, where it is $23. At this output level, the monopolist's total revenue (assuming they charge the same price for every unit sold) would be $21 (3 units sold x $7 price per unit), resulting in a loss of $2.

At any level of output lower than 3, the monopolist's total cost would be lower, but their total revenue would be even lower, resulting in an even greater loss. Therefore, C) 3 units is the best choice for a non-discriminating monopolist to minimize losses.

Table 95 -Refer to Table 9