In comparing a perfectly competitive market and a monopoly, please answer each of the following questions thoroughly, based on your readings and the AVPs, for full credit. Quality outside research can only help your grade; please do not create your responses from the information in the text only. The use of outside references, as well as the textbook, must be cited and referenced. This discussion question has 3 parts. All parts must be answered for full credit. Please remember you must not only answer the question, but respond to other students' postings. The graph is located in the text in Chapter 15, (Figure 15-5).
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Initial Post:
a) Compare the competitive price charged and quantity produced under perfect competition and monopoly. Other than identifying the presence of only one producer under monopoly, why do we tend to see this differential?
b) Does a monopolist achieve efficiency in its production (that is, does it produce where MR = MC)? Will society face a welfare loss in a monopolistic market?
c) Applying Saint Leo's Core Values of responsible stewardship to this question, would you consider that there is never good cause to allow monopolies to operate? Please take into consideration your answer to part b).