Which of the Following Is Not a Difference Between Monopolies

question 147

Multiple Choice

Which of the following is not a difference between monopolies and perfectly competitive markets?

• A)Monopolies can earn profits in the long run while perfectly competitive firms break even.
• B)Monopolies charge a price higher than marginal cost while perfectly competitive firms charge a price equal to marginal cost.
• C)Monopolies choose to produce the quantity at which marginal revenue equals marginal cost while perfectly competitive firms do not.
• D)Monopolies face downward sloping demand curves while perfectly competitive firms face horizontal demand curves.

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Definitions:

Representativeness Heuristic

A cognitive shortcut where the likelihood of something is judged based on how similar it is to a typical case.

Confirmation Bias

The propensity to seek out, interpret, prefer, and remember data in a manner that validates one's already established beliefs or theories.

Mental Set

A tendency to approach a problem in one particular way, often a way that has been successful in the past.

Particular Way

A specific manner, method, or approach to doing something.