A Monopoly

question 88

Multiple Choice

A monopoly

• A)faces a perfectly elastic demand.
• B)ignores the demand curve because it is the only seller.
• C)can raise the price it charges only if it decreases the quantity that it sells.
• D)can raise the price it charges only if it increases the quantity that it sells.
• E)faces a perfectly inelastic demand.

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Definitions:

Demand

The consumers' willingness and ability to purchase goods or services at a given price.

Instrument

A formal document, such as a contract, will, or security, that legally records a right, obligation, or transaction.

Good Faith

The honest intention to act without taking an unfair advantage over another party, based on the belief that others will similarly act honestly.

Altered

Changed, modified, or adjusted from the original state or form.