Which of the Following Statements Is True

Multiple Choice

Which of the following statements is true?

A) If a tax is imposed on a product sold by a monopolist, the monopolist will maximize its profits by producing where marginal revenue equals marginal cost.
B) A monopolist will always charge the highest possible price.
C) If a tax is imposed on a product sold by a monopolist, the monopolist can increase its price to pass along the entire tax to consumers.
D) Because a monopolist faces no competition, the demand for its product is perfectly inelastic.