One difference between a perfectly competitive firm and a monopoly firm is
A)a perfectly competitive firm maximizes profit by producing the quantity of output at which MR = MC, and the monopoly firm does not.
B)a monopoly firm is resource allocative efficient, and a perfectly competitive firm is not.
C)the monopoly firm charges the highest per-unit price for its product, and the perfectly competitive firm does not.
D)the demand curve and the marginal revenue curve are the same for the perfectly competitive firm, but they are not the same for the monopoly firm.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, the demand curve is perfectly elastic, meaning it is the same as the marginal revenue curve. In contrast, a monopoly faces a downward-sloping demand curve, so its marginal revenue curve lies below the demand curve.

One Difference Between a Perfectly Competitive Firm and a Monopoly