Compared with a competitive market with the same cost and market demand circumstances,a monopolist has
A)Less pressure to reduce costs and less reason to improve quality.
B)Less pressure to reduce costs and more reason to improve quality.
C)More pressure to reduce costs and less reason to improve quality.

Question

Quizplus · Accepted Answer

A monopolist has no competition in the market, so they do not face the pressure to reduce costs or improve quality to stay competitive. They have the ability to charge higher prices and still maintain their market power. Therefore, there is less reason for them to improve quality or reduce costs.

Compared with a Competitive Market with the Same Cost and Market