If a monopoly and a perfect competitor had exactly the same cost curves, the monopoly:
A) would produce at a lower level of output than the perfect competitor.
B) would produce a greater output than the perfect competitor.
C) would produce the same quantity of output as the perfect competitor.
D) it is impossible to compare outputs unless the corresponding demand curves are known.

Question

Quizplus · Accepted Answer

A monopoly produces less output than a perfect competitor because it maximizes profit where marginal cost equals marginal revenue, which is less than the price, while a perfect competitor produces where price equals marginal cost.

If a Monopoly and a Perfect Competitor Had Exactly the Same