Question

Which of the following is true of a pure monopoly? Group of answer choices

a. A pure monopoly can raise the market price indefinitely.
b. A pure monopoly is typically more efficient than other firms in the market.
c. A pure monopoly faces a horizontal demand curve.
d. A pure monopoly restricts output to a level below the competitive level.
e. A pure monopoly produces at the level where price equals marginal cost.

Answer 1

The answer is A

Step-by-step explanation:

Pure monopoly can raise the market price indefinitely due to the fact that the market structure is characterized by a single seller or manufacturer, selling a particular product in the market. In a pure monopoly market, the seller faces no competition, as he is the sole seller of goods with no close substitute. He enjoys the power of setting the price for his goods. This in-turn leads to the customers being at the mercy of the seller.