Relative to a perfectly competitive market for an exhaustible resource, the monopolist charges a ________ price and uses the resource more ________.

Question

Quizplus · Accepted Answer

A monopolist has the ability to set a higher price compared to a perfectly competitive market as they have control over the supply of the exhaustible resource. The monopolist is likely to use the resource more slowly as they have an incentive to prolong the use of the resource in order to maintain control over pricing and maximize profits in the long run.

Relative to a Perfectly Competitive Market for an Exhaustible Resource