Which Statement About the Differences Between Monopoly and Perfect Competition

question 163

Multiple Choice

Which statement about the differences between monopoly and perfect competition is INCORRECT?

• A)A monopolist has market power,while a perfect competitor does not.
• B)Unlike a perfectly competitive firm,a monopoly can make positive economic profits in the long run.
• C)A monopoly will charge a higher price and produce a smaller quantity than will a competitive market with the same demand and cost structure.
• D)Monopoly profits can continue in the long run because the monopoly produces more and charges a higher price than does a comparable perfectly competitive industry.

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Definitions:

Economic Value

Refers to the value a good or service has in the context of its ability to generate income or utility.

Interest

The cost of borrowing money or the return on investments, usually expressed as a percentage of the amount lent, deposited, or invested.

Interest

A monetary charge for the concession to borrow currency, habitually framed as an annual percentage figure.

Television

An electronic system of transmitting transient images of fixed or moving objects together with sound over a wire or through space by apparatus that converts light and sound into electrical waves and reconverts them into visible light rays and audible sound.