When a firm operates under conditions of a monopoly, its price is:

Question

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When a firm operates under conditions of a monopoly, it has market power and is the sole supplier of the product or service. As a result, the firm is not constrained by competition, but it will be constrained by demand. The firm will set the price that maximizes its profits, taking into account the level of demand for the product. The higher the demand, the higher the price a monopolistic firm can charge. Therefore, the firm's price will be constrained by demand.

When a Firm Operates Under Conditions of a Monopoly, Its