An Important Difference Between a Monopoly and a Competitive Industry

question 93

Multiple Choice

An important difference between a monopoly and a competitive industry is that:

• A)a monopoly earns zero profits while competitive firms earn positive economic profits in the long run.
• B)a profit-maximizing monopolist equates price and marginal cost while profit-maximizing firms in competitive industries equate marginal revenue and marginal cost.
• C)a monopoly is a price maker while a competitive industry faces a horizontal demand curve.
• D)a monopoly has a vertical supply curve while a competitive firm's marginal cost curve is the supply curve.

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Definitions:

Big Five

A personality model that outlines five major traits used to describe human personality: openness, conscientiousness, extraversion, agreeableness, and neuroticism.

Extraversion

A personality trait characterized by sociability, talkativeness, assertiveness, and high levels of emotional expressiveness.

Imaginative

Possessing the ability or tendency to think creatively and inventively, often leading to new ideas or concepts.

Sexual Orientation

An inherent or immutable enduring emotional, romantic or sexual attraction to other people.