A seller with market power has greater command over product price compared to a perfect competitor and is thus less enthusiastic in devising new ways to create economic value.

Question

Quizplus · Accepted Answer

A seller with market power has the ability to set prices higher than their marginal cost, leading to higher profits. However, they may still have incentives to create economic value by investing in research and development, improving product quality, and expanding their product line to maintain their market position and fend off potential competition. Therefore, the statement in the question is false.

A Seller with Market Power Has Greater Command Over Product