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Question
The firm under pure monopoly ______________.
The firm under pure monopoly ______________.
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Solution
The correct option is D can fix either the price or the quantity to be sold
The monopoly firm can either fix price or quantity sold and not both, this is because he cannot set both high price and high quantity as with high price people will demand less of the quantity. Thus the monopoly firm faces a downward sloping curve where he can set either the price or quantity.
The monopoly firm can either fix price or quantity sold and not both, this is because he cannot set both high price and high quantity as with high price people will demand less of the quantity.
Thus the monopoly firm faces a downward sloping curve where he can set either the price or quantity.
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