GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The monopolist faces
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A downward sloping demand curve
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A downward sloping average revenue curve
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Both (a) and (b)
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None of the above
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Explanation:
Detailed explanation-1: -In contrast, the demand curve, as faced by a monopolist, is the market demand curve, since a monopolist is the only firm in the market, and hence is downward sloping.
Detailed explanation-2: -Monopolists face downward-sloping demand curves because they are the only supplier of a particular good or service, and the market demand curve is therefore the monopolist’s demand curve. How much market power a firm has is a function of the shape of the demand curve.
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