Exhibit 10-8 -Which of the Following Statements Is Always Correct

Multiple Choice

Exhibit 10-8
-Which of the following statements is always correct?

A) Inefficiency is likely to occur under competition but is unlikely to occur in the monopoly market structure.
B) A competitive firm is more able to engage in research and development than is a monopoly.
C) Monopolies transfer some of the potential consumer surplus from buyers to sellers.
D) Monopolies transfer some of the potential producer surplus from sellers to buyers.
E) Monopolies transfer all of the potential consumer surplus from buyers and sellers to the government.