The monopolist faces:
A) a perfectly inelastic demand curve.
B) a perfectly elastic demand curve.
C) the entire market demand curve.
D) all of these.

Question

Quizplus · Accepted Answer

A monopolist faces the entire market demand curve because it is the sole supplier of the product, and all consumers must purchase from the monopolist if they wish to buy the product. A perfectly inelastic demand curve implies that consumers will buy the same quantity of the product regardless of price, which is unrealistic. A perfectly elastic demand curve implies that consumers have many substitutes and will only buy from the monopolist if it offers the lowest price, which is also unrealistic for a monopolist.

The Monopolist Faces