A perfectly competitive firm is said to be more efficient than a monopoly firm because

Question

BlackTom AI · Accepted Answer

First, let's restate the question and the options to ensure clarity: A perfectly competitive firm is said to be more efficient than a monopoly firm because Select one:

a. perfectly competitive firms require their workers to work longer hours than monopoly firms.

b. perfectly competitive firms are faced with a less elastic demand curve than monopoly firms.

c. perfectly competitive firms produce more differentiated products than monopoly firms.

d. perfectly competitive firms charge lower prices and produce more output than monopoly firms.

Now, evaluate each choice:

Option a: 'perfectly competitive firms require their workers to work longer hours than monopoly firms.' This claim is not a standard basis for efficiency comparisons between market structures. Efficiency typically relates to output relative to inputs, costs, and prices, not the scheduling or length of worker hours. So this statement is incorrect on conceptual grounds.

Option b: 'perfectly competitive firms are faced with a less elastic demand curve than monopoly firms.' In a perfectly competitive market, firms face highly elastic (often horizontal) demand because many substitutes exist and individual firms are price takers. A monopoly faces a relatively inelastic demand since it is the sole supplier of the good. Therefore this option mischaracterizes the typical demand elasticities involved and is incorrect.

Option c: 'perfectly competitive firms produce more differentiated products than monopoly firms.' The opposite is generally true: monopolies often offer differentiated or unique products, while perfect competition tends to imply homogeneous products with many identical substitutes. So this option is incorrect.

Option d: 'perfectly competitive firms charge lower prices and produce more output than monopoly firms.' This aligns with the standard understanding of efficiency in economics: multiple small firms in perfect competition lead to prices driven down to marginal cost and higher total output, compared with a single-price setting by a monopoly that restricts output to raise price and maximize profit. Hence, this statement accurately captures the efficiency advantage of perfect competition over a monopoly.

In summary, the reasoning shows that only option d reflects the conventional efficiency comparison between perfectly competitive and monopoly structures, while options a, b, and cmisstate typical concepts about demand elasticity, product differentiation, or indicators of efficiency.}

MUF0061 Economics Unit 1 - Semester 2, 2025 Revision Quiz - Efficiency of Perfect Competition and Monopoly (10 - 12 minutes)

A perfectly competitive firm is said to be more efficient than a monopoly firm because

查看解析

登录即可查看完整答案

类似问题

Over the past 5 years, 50 new restaurants have opened and 30 have closed in the city of Zuni. Currently there are 110 restaurants operating in the city. Which of the following best represents the market structure, barriers to entry, and economic profits in the long run?

In which type of market structure would you expect the highest concentration ratio?

When the CR4 of an industry is equal to 30, it signals that the industry is closer to

A perfectly competitive firm is said to be more efficient than a monopoly firm because

Which market structure do you think would best describe the market for shoes?

According to the video, which market structure category is the toothbrush market best described as?

According to the video, which market structure category is the car market best described as?

更多留学生实用工具

考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单