Compared to a monopolistic competitor, a monopolist faces
A) a more elastic demand curve.
B) a more inelastic demand curve.
C) a demand curve that has a price elasticity coefficient of zero.
D) a more elastic demand curve at higher prices and a more inelastic demand curve at lower prices.
B
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Consider two goods X and Y available for consumption. Assume that the price of X changes while the price of Y remains fixed. For these two goods, the price-consumption curve illustrates the
A) relationship between the price of X and consumption of Y. B) utility-maximizing combinations of X and Y for each price of X. C) relationship between the price of Y and the consumption of X. D) utility-maximizing combinations of X and Y for each quantity of X.
If there are important spillover benefits from consumption of a good, a. government should prohibit its production
b. taxes should be imposed on producers of the product. c. the market demand curve for the good understates the value of the product to society and resources are therefore underallocated to its production. d. the market demand curve for the good overstates the value of the product to society and resources are therefore overallocated to its production.
The price elasticity of demand for a good tends
A) not to vary over time because people adjust to changed circumstances. B) to be greater over the long run than over a short period of time. C) to be less over the long run than over a short period of time. D) to rise when the demand increases. E) toward unity in the long run.
How can economic growth help a country combat "brain drain"?
A) Economic growth combined with decreasing returns to human capital require workers to achieve steadily higher and higher levels of education over time. B) Economic growth opens up opportunities for better jobs and higher incomes for skilled workers. C) Economic growth allows highly skilled persons to earn more in a foreign country than in their native country. D) Economic growth increases the incomes of low-skilled workers relative to high-skilled workers.