Suppose that Shannon is the only economics tutor in Bucksnort and therefore holds a monopoly on the sale of tutoring services. Suppose that Shannon can offer additional hours of tutoring at a constant marginal cost of $2 per hour and faces no fixed costs. Use the table below to answer the following question:
Table: Demand for Economics Tutoring
Quantity of Economics Tutoring Demanded Price of Economics Tutoring
(tours) (per hour)
0...........................................................................................................6
1...........................................................................................................5
2...........................................................................................................4
3...........................................................................................................3
4...........................................................................................................2
5...........................................................................................................1
6...........................................................................................................0
If Shannon acts as a classic monopolist, she will offer hours of tutoring at a price of
a) 1; $5 per hour
b) 2; $4 per hour
c) 3; $3 per hour
d) 4; $2 per hour