If a Monopoly Can Perfectly Price Discriminate

question 264

Multiple Choice

If a monopoly can perfectly price discriminate,

• A) all the demanders pay one price.
• B) it minimizes its profit.
• C) it produces the same amount of output as would be produced if the market was a perfectly competitive industry.
• D) it produces less output than would be produced if the market was a perfectly competitive industry.
• E) it creates the same amount of consumer surplus as would be created if the market was a perfectly competitive industry.

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Definitions:

Exchange-Traded Fund

An Exchange-Traded Fund (ETF) is a type of investment fund and exchange-traded product, the shares of which are traded on stock exchanges.

Market Beta

A measure of a stock's volatility in relation to the market; a beta greater than 1 indicates higher volatility than the market.

Market Portfolio

A theoretical bundle of investments that includes every type of asset available in the market, with each asset weighted according to its market capitalization.

Composition

The makeup or structure of something, such as the arrangement and proportion of parts within a work of art or a financial portfolio.