In the Long Run, a Single-Price Monopolist Will

question 386

Multiple Choice

In the long run, a single-price monopolist will

• A) make zero economic profit.
• B) be able to continue to make an economic profit as long as there is a barrier to entry.
• C) end up being regulated by the government because it is making short-run economic profits.
• D) Both answers A and C are correct.

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Definitions:

Cash

Liquid currency and assets readily convertible to cash that are used by businesses to conduct transactions, pay expenses, and provide financial buffers.

Deferrals

Transactions where the recognition of revenue or expenses is postponed to future accounting periods.

Recognition

The process of formally recording or incorporating an item into the financial statements of an entity.

Incurred Expense

An expense that has been recognized in the accounting period in which it is incurred, regardless of when the payment is made.