The Price of a Factor in a Monopolistic Factor Market

question 83

Multiple Choice

The price of a factor in a monopolistic factor market, as compared to a situation where the monopoly supplier is broken up into a large number of firms selling the factor in a perfectly competitive factor market:

• A) is greater than the price of a factor in an otherwise perfectly competitive factor market.
• B) is less than the price of a factor in an otherwise perfectly competitive factor market.
• C) is equal to the price of a factor in an otherwise perfectly competitive factor market.
• D) increases with the quantity of the factor sold.