Which of the following statements is true?
A) A perfectly competitive market produces more output and charges a lower price than a single-price monopoly.
B) A perfectly competitive market produces more output and charges the same price as a single-price monopoly.
C) A perfectly competitive market produces less output and charges a lower price than a single-price monopoly.
D) A perfectly competitive market produces less output and charges the same price as a single-price monopoly.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, there are many small firms producing an identical product, resulting in a situation where no individual firm has the power to influence the market price. This leads to higher output and lower prices than a single-price monopoly, where a single firm has control over the market and can charge higher prices for lower output levels. Therefore, statement A is true.

Which of the Following Statements Is True