Which of the Following Statements Is True of a Monopolist

question 98

Multiple Choice

Which of the following statements is true of a monopolist?

• A)The firm charges the highest possible price.
• B)The firm always earns a profit.
• C)The firm might earn a profit in the long run.
• D)The firm generates a larger consumer surplus than a perfectly competitive firm.
• E)The firm is more production efficient than a perfectly competitive firm.

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Definitions:

Profit

The financial gain obtained when the amount earned from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.

Codes of Ethics

A set of guidelines designed to set out acceptable behaviors for members of a particular group, organization, or profession.

Mission Statements

Brief descriptions of a company's fundamental purpose and values, intended to guide its strategic planning and operations.

Company's Purpose

The fundamental reason a company exists, often defined by its mission statement or core values.