Which of the following statements is correct?

A) In the short run, the pure monopolist will maximize total profits by producing at that level of output where the difference between price and average total cost is greatest.
B) In the short run, the pure monopolist will charge the highest price it can get for its product.
C) Because of its ability to set its own price, the pure monopolist can increase price and increase its volume of sales simultaneously.
D) Pure monopolists do not always realize positive profits, sometimes they suffer losses.

Question

Yogesh Sachdeva · Accepted Answer

Final Answer : D, Explanation :  Pure monopolists, like firms in other market structures, can experience losses due to high fixed costs, changes in consumer preferences, or competitive pressures from substitute goods. Their market power does not guarantee profitability in all circumstances.

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