If an unregulated monopolist operates in a market,then:
A) customers will pay higher prices than if the market were competitive.
B) customers will purchase fewer units of output than if the market were competitive.
C) society will not be allocating its resources efficiently.
D) all of the above will occur.

Question

Quizplus · Accepted Answer

When an unregulated monopolist operates in a market, they have the power to set prices higher than the competitive market equilibrium, which leads to customers paying higher prices (A) and purchasing fewer units of output (B). This results in an inefficient allocation of resources because monopolies do not produce the socially optimal level of output. Therefore, all of the listed outcomes (A, B, and C) will occur.

If an Unregulated Monopolist Operates in a Market,then