Question: 12. A monopolist knows that if it expands the quantity of output it produces from 8 to 9 units, that will lower the price of

12. A monopolist knows that if it expands the quantity of output it produces from 8 to 9 units, that will lower the price of its output from $2 to $1. Calculate the quantity effect and the price effect. Use these results to calculate the monopolist’s marginal revenue of producing the 9th unit. The marginal cost of producing the 9th unit is positive. Is is a good idea for the monopolist to produce the 9th unit?

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