True statement about monopoly and perfect competition

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Reference no: EM131246039

1. Which of the following is a TRUE statement about monopoly and perfect competition?

a. Price is always higher and output higher under monopoly than under perfect competition.

b. Because costs do not depend on market structure, price is usually higher and output is always lower under monopoly than perfect competition.

c. If there are substantial economies of scale, price may be lower and output greater under monopoly than under perfect competition.

d. If there are substantial economies of scale, price may be lower and output greater under monopoly than under perfect competition, and price may be below marginal cost instead of equal to marginal cost.

2. Compared to perfectly competitive firms, the demand curve for a monopolist will be

a. as elastic.

b. more elastic.

c. less elastic.

d. perfectly elastic.

Reference no: EM131246039

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