Which of the following statements is true?
A) Perfectly competitive markets are efficient, but monopoly markets never are efficient.
B) Perfectly competitive markets always reach equilibrium but monopoly markets never reach equilibrium.
C) Perfect price discriminating monopolists can eliminate all deadweight losses and achieve efficiency.
D) All the above statements are true.

Question

Quizplus · Accepted Answer

Perfect price discriminating monopolists can eliminate all deadweight losses and achieve efficiency as they are able to charge different prices to each consumer based on their willingness to pay, thus capturing all consumer surplus. In contrast, perfectly competitive markets and monopoly markets may or may not be efficient and may or may not reach equilibrium.

Which of the Following Statements Is True