You Are Shown a Graph of a Monopolist in Long-Run

question 156

Multiple Choice

You are shown a graph of a monopolist in long-run equilibrium and a graph of a monopolistically competitive firm in short-run equilibrium. How could you tell which is which?

• A) You probably could not.
• B) In the graph of monopolistic competition, the MR curve could be closer to the demand curve.
• C) In the graph of monopoly, the MR curve would be closer to the demand curve.
• D) In the graph of monopoly, the MC would slope upward.

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Definitions:

Purchase Money Security Interest

A legal claim or lien on collateral provided by a borrower to secure a loan used to purchase the collateral.

Personal Property Security Act

Legislation governing the use of personal property as security for a loan or obligation, detailing rights concerning collateral.

Security Interest

A legal claim or lien on collateral that has been pledged, usually to secure repayment of a loan.

Guarantee

A written commitment whereby a guarantor agrees to pay a debt if the debtor does not.