What effect does a lump-sum profit tax have on a monopolist? Select one: a. It causes the price to increase but has no effect on the output. O b. It has no effect on either the price or the output. C. It causes the output to increase but has no effect on the price. d. It causes the price to increase and the output to decrease. e. It causes the output to decrease but has no effect on the price.

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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What effect does a lump-sum profit tax have on a monopolist?
Select one:
a. It causes the price to increase but has no effect on the output.
b. It has no effect on either the price or the output.
C.
It causes the output to increase but has no effect on the price.
d. It causes the price to increase and the output to decrease.
e. It causes the output to decrease but has no effect on the price.
Transcribed Image Text:What effect does a lump-sum profit tax have on a monopolist? Select one: a. It causes the price to increase but has no effect on the output. b. It has no effect on either the price or the output. C. It causes the output to increase but has no effect on the price. d. It causes the price to increase and the output to decrease. e. It causes the output to decrease but has no effect on the price.
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