Suppose that a perfectly competitive firm and a monopoly firm have the same market demand and cost curves, and neither firm wants to shut down given their current demand.
If the perfectly competitive firm produced the quantity where demand is unit elastic, which of the following is also true?
Choose 1 answer:
A The monopolist produces the quantity that is perfectly elastic.
(B) The monopolist produces the quantity whose marginal revenue equals zero.
(C) The monopolist produces a quantity on the inelastic portion of the demand curve.
(D) The monopolist also produces the unit elastic quantity.
(E) The monopolist produces a quantity on the elastic portion of the demand curve.
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