Which of the Following Statements About Monopoly Equilibrium and Perfectly

question 104

Multiple Choice

Which of the following statements about monopoly equilibrium and perfectly competitive equilibrium is INCORRECT?

• A) Price is greater than marginal cost in monopoly, and price equals marginal cost in perfect competition.
• B) When a monopoly exists, the consumer surplus is less than if the market were perfectly competitive.
• C) Monopoly output will be less than the output of a comparable perfectly competitive industry.
• D) In the long run, economic profits are driven to zero in both a monopoly and a perfectly competitive market.

---

Definitions:

Current Liabilities

Financial obligations or debts a company owes and is expected to pay within a year or within the operating cycle.

Return on Net Sales

A financial ratio indicating the efficiency of a company in generating profit from its net sales, usually expressed as a percentage.

Net Income Before Taxes

Total revenue minus total expenses, excluding tax expenses.

Total Assets

The sum of all assets owned by a business, including cash, inventory, equipment, and real estate.