Discussion Problem of the Day ( 21/06/2011)

[varsha]

State whether  true or false

Imposition of price ceiling would never cause a monopolist to increase output.

[Mahima]

i'm almost a month late in replying..but just came across this website recently.
i think the answer is false.
If the monopolist was charging more than the price ceiling before restriction, then after the restriction is imposed, it'll decrease the price and hence increase the output.

[Amit Goyal]

You are right.