The conclusion that a monopoly results in lower output and higher prices than perfect competition relies on the assumption that
A) the demand curve for a monopoly is horizontal.
B) consumers are ignorant of the effects of monopoly.
C) the costs of production are the same whether the industry is perfectly competitive or a monopoly.
D) elasticity of demand varies along the market demand curve.
Answer: C
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Which of the following statements is true?
A) Using fewer observations will strengthen the force of an empirical argument. B) The number of observations used does not affect the strength of an empirical argument. C) Empirical arguments can be supported without the use of data. D) Using a large data set will strengthen the force of an empirical argument
Explain why insurance has been beneficial to markets
What will be an ideal response?
Refer to the normal-form game of price competition in the payoff matrix below.Firm AFirm B??Low PriceHigh Price?Low Price0,050,-10?High Price-10,5020,20What is the maximum interest rate that can sustain collusion?
A. 30 percent B. 20 percent C. 66.7 percent D. 15 percent
Which statement concerning the kinked demand curve model of oligopoly is false?
A. It addresses the question of price "stickiness." B. It assumes when one oligopoly raises the price, all others will follow. C. The portion of the demand curve above the "kink" is more elastic than the portion below. D. The firm's marginal costs can sometimes shift without changing the profit-maximizing price and output.