Question

Rooshy, a single-priced monopolist, aims to maximize profit selling her patented perfume. What statements are true based on the given graph?

A) If Rooshy sought to maximize total revenue, she would attain social efficiency.
B) If Rooshy maximized total revenue, she would earn $320.
C) We do not have enough data to calculate Rooshy's economic profits under pure monopoly.
D) Rooshy earns (20x8) (0.5x8x20).

Answer 1

Without sufficient data or a provided graph, we cannot verify statements regarding Rooshy’s profits or revenue. Only the assertion that we lack enough information to calculate economic profits under monopoly is valid.

Step-by-step explanation:

Regarding Rooshy's profit-maximization for her patented perfume as a single-priced monopolist, the true statements based on the given graph and information are:

• We do not have enough data to calculate Rooshy's economic profits under pure monopoly. Statement C is correct.
• Roshy's profits are determined as described in step 3 by calculating the difference between total revenue and total costs. However, without the actual figures or graph, statements A, B and D cannot be verified or calculated.

Maximizing total revenue does not inherently lead to social efficiency, which discounts statement A. As total revenue and costs are not provided, it is impossible to affirm statement B about Rooshy's earnings of $320. Statement D lacks context and cannot be confirmed. Hence, statement C is correct in asserting the need for more data to calculate economic profits.