Because monopoly firms do not have to compete with other firms, the outcome in a market with a monopoly: a

Marketing Jan 09, 2021

Because monopoly firms do not have to compete with other firms, the outcome in a market with a monopoly:

a. is efficient

b. is often not in the best interest of society

c. maximizes total economic well-being

d. benefits consumers more so than the producer

Expert Solution

The answer is b).

The outcome in a monopoly is not socially optimal, because the monopolist tends to produce less than what is produced in a competitive market. Therefore, the total surplus in a monopolist is less than the total surplus in a competitive market. Therefore, the monopolist outcome is not in the best interest of the society.

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