When comparing a perfectly competitive firm and a (single-price)monopolist,a major difference is that
A)the monopolist produces where MR = MC,but the perfect competitor does not.
B)the perfect competitor achieves productive efficiency,but the monopolist does not.
C)the perfect competitor produces where P = MC,but the monopolist does not.
D)the monopolist achieves allocative efficiency but the perfect competitor does not.
E)the perfect competitor minimizes its costs,but the monopolist does not.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, firms produce at the point where P = MC, which ensures productive efficiency. However, a monopolist maximizes its profits by producing where MR = MC, which is at a lower output level and a higher price than the perfectly competitive market. Therefore, the monopolist does not achieve productive efficiency, and hence, does not produce where P = MC.

When Comparing a Perfectly Competitive Firm and a (Single-Price)monopolist,a Major