Monopoly profit is not a social problem because
a. the size of the economic pie grows when monopoly profits increase.
b. producers are more efficient than consumers.
c. the profit represents a transfer from the consumer to the producer with no loss in total surplus.
d. None of the above are correct.
c
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Costs paid in money to hire a resource is
A) normal profit. B) an implicit cost. C) an explicit cost. D) an alternative-use cost. E) economic profit.
Which is the most likely effect upon the market for cotton of a significant improvement in the quality of synthetic textiles?
A) A decrease in demand and hence a decrease in both the price of cotton and the quantity exchanged. B) A decrease in demand and hence a decrease in the price of cotton and an increase in the quantity exchanged. C) A decrease in demand and hence an increase in the price of cotton and a decrease in the quantity exchanged. D) A decrease in both demand and supply and hence a decline in the quantity exchanged but no predictable change in the price of cotton.