Price will be higher and output will be lower under monopoly than under perfect competition with the same demand and cost conditions.

Question

Quizplus · Accepted Answer

Monopoly firms have profit maximization as their main objective, which results in a higher price and lower output compared to perfect competition. In perfect competition, firms have to price at the market equilibrium, resulting in a lower price and higher output. Additionally, monopoly firms have market power, which allows them to charge a higher price, while perfect competition firms have no market power and have to price at the market equilibrium.

Price Will Be Higher and Output Will Be Lower Under