A profit-maximising monopoly's price is
A)the same as the price that would prevail if the industry was perfectly competitive.
B)less than the price that would prevail if the industry was perfectly competitive.
C)greater than the price that would prevail if the industry was perfectly competitive.
D)not consistently related to price that would prevail if the market was perfectly competitive.

Question

Quizplus · Accepted Answer

A profit-maximising monopoly has the ability to set higher prices as it faces no competition, unlike a perfectly competitive industry where firms must accept market prices. Therefore, the monopoly's price will be greater than the price that would prevail if the industry was perfectly competitive.

A Profit-Maximising Monopoly's Price Is