Choose the Correct Statement

question 34

Multiple Choice

Choose the correct statement.The deadweight loss from monopoly pricing arises because:
i. monopolists profits are a transfer from consumers to producers
ii. the value some consumers place on the good is greater than the cost of providing it
iii. the market price is above marginal cost

• A)(i) and (ii)
• B)(ii) and (iii)
• C)(iii) only
• D)(i), (ii) and (iii)

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Definitions:

Franchising

A business model that allows individuals or entities to operate a store or restaurant by licensing a brand and business system from a franchisor.

Disadvantages

Negative or less favorable aspects of a situation, plan, or decision.

Franchisee

A business owner who operates a single franchise outlet, having bought the rights from the franchisor to use the business model and branding.

Franchising

A business model where a business owner (franchisor) licenses trademarks and methods to an independent entrepreneur (franchisee) to conduct business under the franchisor's name.