Question

Indicate whether each of the following statements is true or false:

a. Because they can control product price, monopolists are always assured of profitable production by simply charging the highest price consumers will pay.
b. The pure monopolist seeks the output that will yield the greatest per-unit profit.

Answer 1

A. False.

B. False.

Explanation: A monopoly is the phenomenon whereby a company or an organization dominates a sector, industry, or market.

A pure monopoly means that a company is the only seller or in a market with no other close substitutes.

Question A is false because, monopolists can not over charge their products and force consumers to buy, this will only lead to the consumers finding an alternative, or just plainly stopping their purchase of the products.

Question B is also false because a pure monopolist will always thrive when there is a barrier preventing competitors from entering the market, therefore, this is what the pure monopolist will always strive to achieve.