One Difference Between a Monopoly and a Competitive Firm Is

question 89

Multiple Choice

One difference between a monopoly and a competitive firm is that

• A)only a monopoly is a price taker.
• B)only a monopoly maximizes profit by setting marginal revenue equal to marginal cost.
• C)only a monopoly faces a downward-sloping demand curve.
• D)None of the above.

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Definitions:

Acid-Test Ratio

A financial metric that measures a company's ability to pay off its current liabilities with its quick assets, excluding inventory.

Company

A corporate body set up by a team of people aimed at operating and handling a business operation, which might be focused on commerce or industry.

Working Capital

The difference between a company's current assets and current liabilities, indicating the available capital for day-to-day operations.

Company

A legal entity formed by a group of individuals to engage in and operate a business—commercial or industrial—enterprise.