Which of the following is true for a monopolist but not for a perfectly competitive firm?
A) Marginal revenue is less than price.
B) Economic profits could be earned in the long run.
C) Profit maximization occurs at the output level where marginal revenue equals marginal cost.
D) (a) and (b) are true for a monopolist but not for a perfectly competitive firm.

Question

Quizplus · Accepted Answer

A monopolist has the power to set its own price and therefore marginal revenue will always be less than price. Economic profits could be earned in the long run due to the lack of competition in the market. Both of these conditions do not apply to a perfectly competitive firm.

Which of the Following Is True for a Monopolist but Not