Which of the Following Is True for BOTH Monopoly and a Perfectly

question 458

Multiple Choice

Which of the following is true for BOTH monopoly and a perfectly competitive firm?

• A) The demand for the individual firm's product is perfectly elastic.
• B) Economic profits can be sustained indefinitely over time.
• C) The marginal revenue curve is horizontal at the market equilibrium price.
• D) Profits are maximized by producing at the level of output where marginal revenue is equal to marginal cost.

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Definitions:

Service Performed

The completion of an awaited task or the provision of work for customers as part of a contractual agreement.

Allowance for Doubtful Accounts

A reserve against the portion of accounts receivable that may not be collectible, reducing the book value to the amount expected to be collected.

Gross Amount

The total or whole amount of something before any deductions, such as taxes or discounts, are made.