A monopoly is characterized by ________.
A) taking price as given
B) producing where Price = Marginal cost
C) selling a good for which there are no close substitutes
D) selling identical goods

Question

Quizplus · Accepted Answer

A monopoly is characterized by selling a good for which there are no close substitutes. This means that the firm has market power and can charge a higher price than a firm in a competitive market. Choice A refers to a firm operating in a perfectly competitive market, where price is taken as given. Choice B refers to a firm operating in a perfectly competitive market, where price is equal to marginal cost. Choice D refers to a firm operating in a monopolistic competition market, where goods are differentiated.

A Monopoly Is Characterized by ________