A monopoly is likely to set the price of its product equal to its marginal cost.

Name: A monopoly is likely to set the price of its product equal to its marginal cost.
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Question

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Monopolies have the ability to set prices higher than marginal cost in order to maximize profits since they have control over the market and are the only supplier. Therefore, they do not typically set prices equal to marginal cost.

A Monopoly Is Likely to Set the Price of Its