Consider a monopolist that is maximining its profits selling 100 units of its output. What happens if the firm expands output? (Assuming nothing else changes.)
A. The firm will necessarily lower its profit since to expand output it would need to lower its price which will lower its revenue from that next unit below the cost of supplying the unit.
B. The firm will earn more profit since it has a monopoly.
C. Profit may go up or down, there is no way to tell without the numbers.
D. Profit will go up since the next unit has a higher opportunity cost which equals the profit the firm would earn in some other venture.