13. A monopolist's marginal revenue will always be less than market
price. This is because:
- There are substantial startup costs and other barriers to entry.
- The firm is able to practice perfect price discrimination.
- Demand and marginal revenue have an inverse relationship.
- Because monopolist always have higher production costs than other
types of firms or industries.
- The monopolist must reduce the price of all units of output, not
just an additional unit, in order to increase sales.
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