How do market and firm demand curves differ for monopolists?
The firm and market demand curves are identical for a monopolist. As opposed to perfectly competitive firms, which have flat demand curves and downward-sloping market demand curves, the monopolist is the sole seller to the market, and hence the market demand is the firm demand. 4. Can a monopolist charge any price that it wants? No. A monopolist is constrained by the demand curve. Technically, a monopolist can charge any price, but they will only sell what the demand curve indicates people will buy at that price. If there is no demand at the monopolist s price, the monopolist will not sell anything. 5. How does a monopolist maximize profits? A monopolist produces a quantity such that the marginal revenue equals the marginal cost. The firm then finds the highest price it can charge in order to sell that many units, by looking at the demand curve. When the firm produces that quantity at that price, profits will be maximized. 6. Why does a monopolist not have a supply curve? A supply curv
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