Which of the following statements is correct?
A) Monopolies are guaranteed to earn an economic profit.
B) The market demand and the firm's demand are the same for a monopoly.
C) Monopolies have perfectly inelastic demand for the product sold.
D) Because a monopoly is the only firm in the market, its supply curve is the same as the market demand curve.
E) Because a monopoly is the only firm in the market, its marginal revenue curve must be the same as the market demand curve.
B
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Because of low unemployment rates in the country, employers offer higher wages. To meet their higher payroll costs and maintain profits, they charge consumers more for goods and services. What are the likely consequences?
(A) A wage-price spiral of ever-increasing prices. (B) Increasing numbers of people living on a fixed income. (C) Demand-pull inflation. (D) A prolonged period of deflation.
Although the subprime mortgage market problem began in the United States, the first indication of the seriousness of the crisis began in
A) Europe. B) Australia. C) China. D) South America.