Which of the Following Explains Why Firms in Competitive Price-Searcher

question 70

Multiple Choice

Which of the following explains why firms in competitive price-searcher and competitive price-taker markets will both have zero economic profits in the long run but a monopoly will not?

• A) There is always more than one firm in competitive price-searcher and competitive price-taker markets.
• B) Both competitive price-searcher and competitive price-taker markets are characterized by firms producing identical goods, but a monopoly is not.
• C) In both competitive price-searcher and competitive price-taker markets, the barriers to entry are low; this is not true under a monopoly.
• D) A monopoly firm has a downward-sloping demand curve; firms in the other types of markets do not.

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