Asked by
Hillman Smith
on Dec 12, 2024
Verified
If the average total cost curve is always above the demand curve of a monopolist,
A) the profits of the monopolist will be large.
B) the monopolist must be producing inefficiently.
C) even a monopolist will suffer economic losses.
D) entry will occur, forcing the monopolist to reduce price and expand output.
Average Total Cost
The total cost divided by the quantity of output produced, representing the per-unit cost of production.
Economic Losses
Financial losses incurred by businesses or the economy as a whole, often as a result of unfavorable market conditions.
- Identify the conditions under which monopolists can earn economic profits or suffer losses.
Verified Answer
KG
Learning Objectives
- Identify the conditions under which monopolists can earn economic profits or suffer losses.