A key difference between a monopoly and a perfectly competitive firm is that the monopolist
A) does not face fixed costs in the short run.
B) has a marginal revenue curve that lies below its demand curve.
C) has no marginal cost curve.
D) faces a perfectly elastic demand for its product.

Question

Quizplus · Accepted Answer

A monopolist's marginal revenue curve lies below its demand curve because it must lower the price to sell additional units, unlike a perfectly competitive firm that faces a perfectly elastic demand curve.

A Key Difference Between a Monopoly and a Perfectly Competitive