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The XYZ Company is a profit-maximizing firm with a monopoly in the production of pennants. The firm sells its pennants for $10 each. We can conclude that the XYZ Company is producing a level of output at which the demand for pennants is:
Question 14 options:
elastic.
unit price elastic.
inelastic.
perfectly inelastic.

Answer :

eooyibo123

Answer:

elastic.

Explanation:

A monopolynis defined as a situation where a single supplier produces a good and so control quantity supplied and price of the product. Monopoly maximises profit when price is elastic and marginal revet is positive. When profit is maximised increase in price from that point does not result in increased profit.

On the other hand when a firm is not maximising profit, it is making profit but can take step to earn more. In this situation increase in price will result in higher profits

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