Which One of the Following Correctly Identifies a Characteristic of a Monopolistic

question 10

Multiple Choice

Which one of the following correctly identifies a characteristic of a monopolistic market?

• A) A monopolist maximizes profit at the point where price = marginal cost.
• B) A monopolist will always earn supernormal profits.
• C) A monopoly firm faces a perfectly elastic demand curve.
• D) There is no excess capacity in a monopoly.

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Definitions:

Law Firm

A business entity formed by one or more lawyers to engage in the practice of law, offering legal services to clients.

Service Business

A business that provides intangible products or services to customers, as opposed to selling physical, tangible goods.

Large Businesses

Enterprises or corporations that operate on a large scale in terms of revenue, employees, and market impact, often influencing their industry or sector significantly.

Corporation

A legal entity distinct from its owners, with its own rights, privileges, and liabilities.