3820EconomicsMedium
Which of the following is true regarding the similarities and differences in monopolistic competition and monopoly?
ABoth the monopolist and the monopolistic competitor operate at the efficient scale
Bthe monopolist charges a price above marginal cost while the monopolistic competitor charges a price equal to marginal cost
CThe monopolist makes economic profits in the long run while the monopolistic competitor makes zero economic profits in the long run
Dthe monopolist faces a downward-sloping demand curve while the monopolistic competitor faces an elastic demand curve
Correct answer
C. The monopolist makes economic profits in the long run while the monopolistic competitor makes zero economic profits in the long run
Explanation
The correct answer is The monopolist makes economic profits in the long run while the monopolistic competitor makes zero economic profits in the long run.