An Important Difference Between a Perfectly Competitive Market and a Monopoly

question 55

Multiple Choice

An important difference between a perfectly competitive market and a monopoly is that:

• A) the demand curve facing a monopoly is horizontal, while the demand curve facing a competitive firm is upward sloping.
• B) a monopoly firm is a price taker, while a perfectly competitive firm is a price setter.
• C) a perfectly competitive firm makes supernormal profits, while a monopoly firm makes zero profits.
• D) market price is not equal to marginal cost in a monopoly, while for a perfectly competitive

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Definitions:

Deductions

Amounts that are subtracted from gross income when calculating taxable income, including expenses, allowances, or specific exemptions.

Exemptions

Specific allowances that relieve individuals, organizations, or products from fulfilling certain conditions or requirements, often for taxes or regulations.

Personal Income Tax

A tax levied on individuals or households based on their total income from various sources, including wages, salaries, and investments.

Taxable Income

The portion of an individual's or corporation’s income that is subject to taxes according to the laws and regulations of a particular jurisdiction.