A firm that sells in a competitive market restricts output and charges higher prices than it would if it were a monopolist.

Question

Quizplus · Accepted Answer

In a competitive market, firms cannot restrict output and charge higher prices because they face competition from many other firms. A monopolist, by contrast, can restrict output and charge higher prices since it is the sole provider of a good or service.

A Firm That Sells in a Competitive Market Restricts Output