A monopoly realizes larger profits than a comparable competitive market by
A)Setting a higher price at the competitive level of output,thereby increasing total revenue.
B)Producing a greater quantity at the competitive price,thereby increasing profits.
C)Producing at output levels with more favorable cost structures and charging the competitive market price,thereby increasing profits per unit.
D)Reducing production and pushing prices up.

Question

Quizplus · Accepted Answer

Monopolies can restrict output to increase prices above competitive levels, as they are the sole providers of a product or service. This strategy allows them to realize larger profits than in a competitive market, where prices are driven down by competition.

A Monopoly Realizes Larger Profits Than a Comparable Competitive Market