A Monopoly Is Most Likely to Emerge and Be Sustained

question 193

Multiple Choice

A monopoly is most likely to emerge and be sustained when

• A) output demand is relatively elastic.
• B) firms have U-shaped average-total-cost curves.
• C) fixed capital costs are small relative to total costs.
• D) economies of scale are large relative to market demand.

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Definitions:

Social Comparison

The process of evaluating oneself by comparing with others.

Self-Enhancement Motive

The desire to maintain, increase, or enhance one's positive self-view.

Appraisal Motive

The desire to find out why things happen and what the causes of events are, often related to understanding one's own emotional responses.

Consistency Motive

The desire to maintain harmony and coherence among one’s beliefs, attitudes, and behaviors to avoid cognitive dissonance.