A Difference Between a Perfectly Competitive Industry and a Monopoly

question 350

Multiple Choice

A difference between a perfectly competitive industry and a monopoly is that

• A) in the long run, firms in a perfectly competitive industry make zero economic profit and a monopoly can make an economic profit.
• B) a firm in a perfectly competitive industry can perfectly price discriminate but a monopoly cannot.
• C) only monopolies have an incentive to maximize profit.
• D) perfectly competitive firms can have a public franchise.
• E) a barrier to entry protects perfectly competitive firms in the short run and protects a monopoly in the long run.

---

Definitions:

CITES

The Convention on International Trade in Endangered Species of Wild Fauna and Flora is a global agreement designed to guarantee that the international trading of wildlife species does not endanger their existence.

Endangered Species

Animal or plant species at risk of extinction due to factors like habitat destruction, pollution, or overhunting.

International Trade

The exchange of goods, services, and capital between countries and territories, influenced by international agreements, tariffs, and economic policies.

Precautionary Principle

A strategy to cope with possible risks where scientific understanding is yet incomplete, favoring preventive action in the face of uncertainty.