Which of the Following Is True of Monopolies

question 50

Multiple Choice

Which of the following is true of monopolies?

• A)Monopolists are concerned about reaping their monopoly profits, which retards technological innovation.
• B)Monopolists always produce on the inelastic part of the demand curve because increased output leads to greater revenue.
• C)Welfare losses that occur in a monopoly cannot be calculated.
• D)Monopolists never incur economic losses in the long run.
• E)Pure monopolies are abundant because many goods and services have only one producer.

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Definitions:

Investment Property

Real estate property that is purchased with the intention of earning a return through rental income, the future resale of the property, or both.

FVTPL

Fair Value Through Profit or Loss; a classification under IFRS for financial assets that are held for trading or designated upon initial recognition to be measured at fair value with changes recognized in profit or loss.

Hedge Accounting

A method of accounting where entries for the ownership of a security and the opposing hedge are treated as one, to show a more accurate financial position.

Hedging Instrument

Any financial derivative or other contract used to offset the risk of changes in the value of an asset, liability, or future transaction.