Question 17 4 pts
Assume a profit-maximizing monopoly and firms in a perfectly competitive market
have identical cost and revenue conditions. In which market will a binding price ceiling
result in a more efficient outcome and why?
The perfectly competitive market will become more efficient because the deadweight loss
will decrease
The perfectly competitive market will become more efficient because consumers will be able
to purchase greater quantities of the good at a lower price
The monopoly will become more efficient because the deadweight loss will decrease
The monopoly will become more efficient because producers will be able to sell greater
quantities of the good at a higher price
Both markets will become more efficient because total economic surplus will increase