A monopoly is
A) a price taker.
B) able to ignore the demand for its product when setting its price.
C) able to set the price for its product.
D) able to earn only a normal profit in the long run.
E) a firm with no marginal revenue curve.

Question

Quizplus · Accepted Answer

A monopoly is able to set the price for its product because it has no competition in the market. It can charge a higher price than would be possible in a competitive market because consumers have no other options. This allows the monopoly to earn above-normal profits in the long run.

A Monopoly Is