Which of the following conditions would most likely permit a monopolist to continue earning economic profits even in the long run?
A) a price below average variable cost for all levels of output
B) loss of patent protection
C) a total revenue that is lower than fixed cost for all levels of output
D) significant barriers to entry
E) loss of control over a basic input

Question

Quizplus · Accepted Answer

Significant barriers to entry prevent new firms from entering the market, ensuring that the monopolist is protected from competition and able to maintain its monopoly power and economic profits in the long run. Options A, B, and C all suggest that the monopolist is unable to earn economic profits, while option E implies that the monopolist may face higher input costs but does not necessarily prevent economic profits.

Which of the Following Conditions Would Most Likely Permit a Monopolist