-Refer to the Above Figure $P _ { 1 }$ )While Under Monopoly Output Is Too Large

question 190

Multiple Choice

-Refer to the above figure.Which of the following statements is true?

• A)Under perfect competition,the efficient price is charged,which is the lowest price possible ( \(P _ { 1 }\) )while under monopoly output is too large ( \(\mathrm { Q } _ { 4 }\) )and price is too high ( \(\mathrm { P } _ { 4 }\) ).
• B)Under perfect competition price equals marginal cost ( \(\mathrm { P } _ { 3 }\) )while under monopoly price ( \(\mathrm { P } _ { 4 }\) )is greater than marginal cost ( \(P _ { 1 }\) ).
• C)The rate of output is the same under both monopoly and perfect competition ( \(\mathrm { Q } _ { 1 }\) ),but price is higher under monopoly ( \(\mathrm { P } _ { 4 }\) rather than \(P _ { 1 }\) ).
• D)Price equals marginal cost under both monopoly and perfect competition,but output is too low under monopoly ( \(\mathrm { Q } _ { 1 }\) instead of \(\mathrm { Q } _ { 2 }\) ).

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