In contrast with perfect competition,a monopolist:

A) produces more at a lower price.
B) produces where MR > MC,and a perfectly competitively firm produces where P = MC.
C) may have economic profits in the long run.
D) earns zero economic profits in the long run.

Question

Sandeep Shrestha · Accepted Answer

Final Answer : C, Explanation :  Monopolist can have economic profits in the long run because they are the sole producer in the market and can set higher prices than the production cost, creating a price premium. This allows them to earn profits in the long run. In contrast, in perfect competition, firms will only earn zero economic profits in the long run due to the pressures of competition driving prices down to the cost of production.

In contrast with perfect competition,a monopolist:

A) produces more at a lower price.
B) produces where MR > MC,and a perfectly competitively firm produces where P = MC.
C) may have economic profits in the long run.
D) earns zero economic profits in the long run.

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Learning Objectives

Related questions

In contrast with perfect competition,a monopolist:A) produces more at a lower price.B) produces where MR > MC,and a perfectly competitively firm produces where P = MC.C) may have economic profits in the long run.D) earns zero economic profits in the long run.

Definitions

Learning Objectives

Learning Objectives

Related questions

In contrast with perfect competition,a monopolist:

A) produces more at a lower price.
B) produces where MR > MC,and a perfectly competitively firm produces where P = MC.
C) may have economic profits in the long run.
D) earns zero economic profits in the long run.