Which statement about monopolies is NOT correct?
A) In the short run, monopolies can suffer losses.
B) In the short run, monopolies never shut down.
C) In the long run, monopolies must at least earn normal profit.
D) In the long run, if losses persist, monopolies will exit the industry.

Question

Quizplus · Accepted Answer

Monopolies, like firms in other market structures, can shut down in the short run if the revenue they would earn from staying open is less than their variable costs. This decision is based on the same shutdown rule that applies to perfectly competitive firms, indicating that the statement B is not correct.

Which Statement About Monopolies Is NOT Correct