Compared to a monopolistic competitor, a monopolist faces
A)a more elastic demand curve.
B)a more inelastic demand curve.
C)a more elastic demand curve at higher prices and a more inelastic demand curve at lower prices.
D)a demand curve that has a price elasticity coefficient of zero.

Question

Quizplus · Accepted Answer

A monopolist faces a less elastic demand curve compared to a monopolistic competitor because it has no close substitutes, making consumers less responsive to price changes. In contrast, a monopolistic competitor faces a more elastic demand curve since consumers can easily switch to competing products.

Compared to a Monopolistic Competitor, a Monopolist Faces