Monopolists Are Said to Be Allocatively Inefficient Because

question 186

Multiple Choice

Monopolists are said to be allocatively inefficient because

• A) they produce where MR > MC.
• B) at the profit-maximizing output, price is greater than AVC.
• C) they produce only the type of product they desire and do not consider the consumer.
• D) at the profit-maximizing output, the marginal benefit of the product to society exceeds its marginal cost.

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