Which of the following indicates the major difference between monopolists and competitive price searchers?
a. Monopolists will always be able to make economic profit; competitive price searchers will not.
b. Barriers to entry are high under monopoly but low in competitive price-searcher markets.
c. Monopolists will face a downward-sloping demand curve; competitive price searchers will not.
d. Unregulated monopolists will charge prices that exceed marginal cost; competitive price searchers will not.
B
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When Monica's Catering lowered the price of catered meals from $60 per person to $20 per person, the quantity demanded doubled from 500 meals to 1,000 meals
You can conclude that the demand for Monica's catered meals over the price range of $20 to $60 is A) upward sloping. B) unit elastic. C) elastic. D) inelastic.
Will a binding price floor result in a shortage or a surplus in the market?