If the Market for Diamonds Is a Monopoly, Then

question 71

Multiple Choice

If the market for diamonds is a monopoly, then

• A) there is an inefficient amount of resources allocated to the diamond market.
• B) the prices of diamonds are too low.
• C) diamond production is at the amount where the marginal social benefit equals the marginal social cost.
• D) the diamond market is efficient.

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Definitions:

Industrial Buyer

An individual or organization that purchases goods or services for use in the production of other products or for resale.

Consumer Products

Goods that are purchased by individuals for personal use rather than for manufacturing or resale.

Shopping Effort

The amount of time and energy consumers expend to complete a purchase, including research, comparison, and decision-making processes.

Resale

The act of selling a product or service again after it has been purchased, often used goods.