Which of the following is true about a monopoly?
A) A monopoly charges a higher price and produces a lower output level than if the market were competitive.
B) A monopoly is guaranteed an economic profit.
C) A monopoly charges the highest possible price.
D) A monopoly will shut down whenever losses are incurred.
E) All of the above.

Question

Quizplus · Accepted Answer

A monopoly has the ability to control the market price and restrict output, leading to a higher price and lower output level than in a competitive market. However, it is not guaranteed an economic profit, may not charge the highest possible price, and will not always shut down when losses are incurred.

Which of the Following Is True About a Monopoly