Which of the following is true about a monopoly?
A)Its demand curve is generally less elastic than in more competitive markets.
B)It will always earn economic profit.
C)It will always produce the same as a perfectly competitive firm.
D)It will always be subject to government regulation.
E)None of the above is true.

Question

Quizplus · Accepted Answer

A monopoly has the power to raise prices without losing too many customers, therefore its demand curve is generally less elastic than in more competitive markets. The other statements are false as a monopoly may not always earn economic profit, may not produce the same as a perfectly competitive firm, and may not always be subject to government regulation.

Which of the Following Is True About a Monopoly