How will the price and output of a monopolist compare with perfect competition? The output of the monopolist will be too small and the price too high. The output of the monopolist will be too small and the price too low. The output of the monopolist will be too large and the price too low. The output of the monopolist will be too large and the price too high.
How will the
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The output of the monopolist will be too small and the price too high. |
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The output of the monopolist will be too small and the price too low. |
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The output of the monopolist will be too large and the price too low. |
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The output of the monopolist will be too large and the price too high. |
Meaning of Perfect Competition:
The term perfect competition refers to the market under which there are a huge number of sellers producing the products in the market and a huge number of buyers, which purchases those products at a certain price.
Thus under perfect competition, the consumers have perfect and full knowledge about the products and prices, therefore any slight increase in the prices can shift the consumer to another seller, as there remain close substitutes.
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