The Figure Given Below Shows the Aggregate Demand and Supply

question 10

Multiple Choice

The figure given below shows the aggregate demand and supply curves of a perfectly competitive market.Figure 10.7

-Which of the following is true of the demand curve faced by a monopolist?

• A)​A monopolist's demand curve is infinitely elastic.
• B)​A monopolist's demand curve is more elastic than a competitive firm's demand curve.
• C)​A monopolist faces a relatively inelastic demand curve.
• D)​A monopolist's demand curve coincides with its marginal revenue curve.
• E)​A monopolist faces a positively sloped demand curve.

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Definitions:

Market Prices

Prices determined by the supply and demand for goods and services in a competitive market.

Excise Tax

A tax directly levied on certain goods, services, or activities, often with the aim of discouraging their use or consumption.

Relative Burden

The comparative impact of a tax, cost, or other financial obligation on an individual or group.

Inelastic Demand

Inelastic demand is a situation where the demand for a product does not significantly change with a change in the product's price.