An Important Difference Between a Monopoly and a Competitive Industry

Multiple Choice

An important difference between a monopoly and a competitive industry is that:

A) a monopoly earns zero profits while competitive firms earn positive economic profits in the long run.
B) a profit-maximizing monopolist equates price and marginal cost while profit-maximizing firms in competitive industries equate marginal revenue and marginal cost.
C) a monopoly is a price maker while a competitive industry faces a horizontal demand curve.
D) a monopoly has a vertical supply curve while a competitive firm's marginal cost curve is the supply curve.