Suppose a Competitive Firm and a Monopolist Are Both Charging

question 89

Multiple Choice

Suppose a competitive firm and a monopolist are both charging $5 for their respective outputs.You can infer that:

• A)the marginal benefit from an additional unit sold is $5 for both firms.
• B)the marginal benefit from an additional unit sold is $5 for the competitive firm and less than $5 for the monopolist.
• C)the marginal benefit from an additional unit sold is less than $5 for both firms.
• D)the competitive firm is charging too much and the monopolist too little.

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Definitions:

Dispositional Attribution

The process of attributing behavior to internal factors or personality traits.

Consensus Behaviour

Actions taken collectively by a group based on widespread agreement or harmony of opinion within the group.

Distinctiveness

The quality of being distinctly different or unique, often used in the context of individual or group identity and characteristics.

Consistency

The quality of achieving a level of performance or behavior that does not vary greatly in quality over time.