Suppose an oligopolist individually maximizes its pr... - Solved MCQs & Answer

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Suppose an oligopolist individually maximizes its profits. When calculating profits, if the output effect exceeds the price effect on the marginal unit of production, then the oligopolist?

AShould produce fewer units

Bhas maximized profits.

CShould produce more units

Dis in a Nash equilibrium

Eshould exit the industry.

Correct answer

C. Should produce more units

Explanation

The correct answer is Should produce more units.

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