Which of the following statements accurately describes a difference between a firm that is a monopolist and one that is in a competitive price-searcher market?
A) A competitive price searcher produces at the output level where marginal cost equals marginal revenue; a monopolist does not.
B) A monopolist faces a downward-sloping demand curve; a competitive price searcher does not.
C) A monopolist charges a price higher than marginal cost; a competitive price searcher does not.
D) In the long run, a competitive price searcher will earn zero economic profit because of low entry barriers, while a monopolist may earn positive economic profits in the long run.
Correct Answer:
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A) a
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