Which of the Following Correctly Defines a Monopoly That Arises

question 174

Multiple Choice

Which of the following correctly defines a monopoly that arises from economies of scale?

• A) a single firm operating in a market
• B) a single firm that can supply the market at a lower cost than two or more firms
• C) a single firm that controls the production of a natural resource
• D) a single firm that produces the efficient and socially optimal quantity in a market

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Definitions:

Cost of Goods Sold

An accounting term denoting the direct costs attributable to the production of goods sold by a company.

FIFO

"First In, First Out," an inventory valuation method where the goods first added to inventory are the first to be sold.

Gross Profit Method

An estimating technique used to calculate inventory cost, based on the gross margin and cost of goods sold.

Gross Profit Ratio

A financial metric indicating the percentage of revenue that exceeds the cost of goods sold; it is calculated by dividing gross profit by net sales.