The Price Charged by a Monopolist Is Socially Inefficient Because

question 144

Multiple Choice

The price charged by a monopolist is socially inefficient because the price

• A) exceeds the true marginal cost of the resources used.
• B) is less than the opportunity cost of the resources used.
• C) puts the monopolist into a higher tax bracket.
• D) is too low.

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Definitions:

Production

The process of translating raw materials or inputs into finished goods or services through the application of labor, tools, and technology.

Specialize

involves focusing on a particular area of production or service in which a person or country holds a comparative advantage, allowing for increased efficiency and output.

Import

The process of importing products or services from foreign countries for the purpose of selling them domestically.

Domestic

Pertaining to or occurring within a country’s borders, often in reference to products produced, services rendered, or economic activities.