A monopolist may make a profit
A)only in the short run.
B)only in the long run.
C)in both the short and long run.
D)in neither the short nor long run.

Question

Quizplus · Accepted Answer

The monopolist may make a profit in both the short and long run as long as it can continue to maintain its dominant position in the market, charging high prices and limiting output. However, in the long run, if new competitors enter the market or if consumer preferences shift towards substitutes, the monopolist may lose its market power and experience a decrease in profits.

A Monopolist May Make a Profit