Which of the following is generally true of monopoly?
A)Average revenue equals price.
B)Price exceeds marginal cost.
C)Marginal revenue is less than price.
D)Output is restricted relative to the socially efficient level.
E)All of the above are generally true of monopoly.

Question

Quizplus · Accepted Answer

In a monopoly, average revenue equals price because the monopolist is the sole seller. Price exceeds marginal cost because monopolists maximize profit where marginal cost equals marginal revenue, which is less than price. Output is restricted relative to the socially efficient level because monopolists produce less to keep prices higher.

Which of the Following Is Generally True of Monopoly