A monopolist will charge a lower price and produce more output than if it was operating in a competitive market.

Question

Quizplus · Accepted Answer

A monopolist has market power and can set the price higher than in a competitive market. In fact, a monopolist will typically charge a higher price and produce less output than in a competitive market. This is because they face no direct competition and can maximize their profits by restricting output and charging a high price.

A Monopolist Will Charge a Lower Price and Produce More