Use the figure below to answer the following questions. Figure 12.3.1
-Refer to Figure 12.3.1.If this market is a single-price monopoly,then
A)it is efficient because the monopoly is maximizing economic profit.
B)price is equal to marginal cost and the outcome is efficient.
C)price is less than marginal cost,and consumer surplus is less than in a perfectly competitive market.
D)price is greater than the marginal cost and the outcome is inefficient.
E)the outcome is inefficient because the monopoly's costs are too high.

Question

Use the figure below to answer the following questions.  Figure 12.3.1
-Refer to Figure 12.3.1.If this market is a single-price monopoly,then
A)it is efficient because the monopoly is maximizing economic profit. 
B)price is equal to marginal cost and the outcome is efficient. 
C)price is less than marginal cost,and consumer surplus is less than in a perfectly competitive market. 
D)price is greater than the marginal cost and the outcome is inefficient. 
E)the outcome is inefficient because the monopoly's costs are too high.

Quizplus · Accepted Answer

In a single-price monopoly, the price set by the monopolist is higher than the marginal cost, which leads to an inefficient allocation of resources. This is because the monopolist restricts output to raise prices and maximize profits, leading to a deadweight loss in the market.

Use the Figure Below to Answer the Following Questions