Which of the following is true of monopolies and their incentive to innovate?
A)Monopolies have the incentive to suppress innovation in order to sustain abnormal profits.
B)Monopolies do not have the incentive to innovate,even in the short run,unless they receive patents for their invention.
C)Monopolies do not have the incentive to innovate because they will continue to earn zero economic profits even with innovation.
D)Monopoly firms have the incentive to innovate and introduce new products in order to expand their profit.

Question

Quizplus · Accepted Answer

Monopoly firms have the incentive to innovate and introduce new products because it can help them expand their profit. By creating new products or improving existing ones, they may be able to increase their market power, reduce competition, and maintain profitability in the long run. Additionally, innovation can lead to cost savings and efficiency improvements, further increasing profits in the long run.

Which of the Following Is True of Monopolies and Their