A Monopolist Faces a Constant Marginal Cost of $1 Per

A monopolist faces a constant marginal cost of $1 per unit. If at the price he is charging, the price elasticity of demand for the monopolist's output is -0.5, then

A) the price he is charging must be $2.
B) the price he is charging must exceed $2.
C) the price he is charging must be less than $2.
D) the monopolist cannot be maximizing profits.
E) the monopolist must use price discrimination.

Correct Answer:

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