Which of the Following Is a TRUE Statement About Monopoly

question 278

Multiple Choice

Which of the following is a TRUE statement about monopoly and perfect competition?

• A) Price is always higher and output higher under monopoly than under perfect competition.
• B) Because costs do not depend on market structure, price is usually higher and output is always lower under monopoly than perfect competition.
• C) If there are substantial economies of scale, price may be lower and output greater under monopoly than under perfect competition.
• D) If there are substantial economies of scale, price may be lower and output greater under monopoly than under perfect competition, and price may be below marginal cost instead of equal to marginal cost.

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Definitions:

Commissions

Payments or earnings based on a percentage of the sales made by a salesperson or agent.

Median

The middle value in a data set when the values are arranged in ascending or descending order; if there is an even number of observations, it is the average of the two middle values.

Poker Players

Individuals who engage in the card game poker, either as a hobby or professionally.

Skewed

describes a distribution that is asymmetrical, with a majority of values lying to one side of the mean.