The good produced by a monopoly
A) has perfect substitutes.
B) has no substitutes at all.
C) has no close substitutes.
D) can be easily duplicated.
E) must be unable to be resold.

Question

Quizplus · Accepted Answer

A monopoly produces goods that have no close substitutes in the marketplace, which means that consumers cannot find a close alternative to the product. This lack of substitutes gives the monopoly market power to charge higher prices and generate economic profits. However, it also means that the monopoly has a greater incentive to innovate and improve its products since there is no viable substitute available to consumers.

The Good Produced by a Monopoly