If One Were to Compare a Competitive Market to a Monopoly

question 90

Multiple Choice

If one were to compare a competitive market to a monopoly that engages in perfect price discrimination,one could say that

• A)in both cases, total social welfare is the same.
• B)total social welfare is higher in the competitive market than with the perfectly price discriminating monopoly.
• C)in both cases, some potentially mutually beneficial trades do not occur.
• D)consumer surplus is the same in both cases.

---

Definitions:

Funds-Flow Statement

A financial statement that shows the inflows and outflows of funds from operations, financing, and investing activities, illuminating how a company's financial position changes over time.

Exchange Gains/Losses

The profit or loss resulting from foreign currency transactions due to changes in exchange rates.

Functional Currency

The currency of the primary economic environment in which an entity operates and carries out its financial transactions.

Property, Plant, And Equipment

Long-term assets owned by a business for the purpose of production, supply, rental, or administrative use, not intended for sale during the normal course of business.