Which of the following statements about monopoly is false?
A) A single firm serves the market.
B) There are no close substitutes for the monopolist's output.
C) There are usually significant barriers to entry.
D) Because there is a single firm serving the entire market, the monopolist can charge whatever price it wants to for its output.
D
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The property of diminishing marginal rate of substitution follows from the property that the indifference curves are
A) downward sloping. B) upward sloping. C) bowed in toward the origin. D) bowed out from the origin.
The cross-price elasticity of demand between goods X and Y is ?3.5. If the price of X decreases by 7 percent, the quantity demanded of Y will:
A. increase by 2.45 percent. B. decrease by 2.45 percent. C. decrease by 24.5 percent. D. increase by 24.5 percent.
Refer to the table below. A technological advance lowers production costs such that the quantity supplied increases by 60 units of this product at each price. As a result of this technological change, equilibrium output in this market:
A. Decreased by 60 units
B. Increased by 60 units
C. Increased by 30 units
D. Decreased by 30 units
If certification decreases supply and serves as a barrier to entry, it ________ the price and ________ market power of the suppliers already in the market.
A) decreases; decreases B) decreases; increases C) increases; increases D) increases; decreases