Suppose That a Perfectly Competitive Firm and a Monopolist Are

question 204

Multiple Choice

Suppose that a perfectly competitive firm and a monopolist are both charging $5 per unit for their respective outputs.One can infer that

• A) marginal revenue is $5 for both firms.
• B) marginal revenue is $5 for the competitive firm and less than $5 for the monopolist.
• C) marginal revenue is less than $5 for both firms.
• D) the competitive firm is charging too much and the monopolist too little.
• E) both firms are earning a profit.

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