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easyMCQCUET Accountancy 2025 3 June Shift 22026Accountancy
1 mark

Which market conditions enable firms to earn high/supernormal profits over an extended period due to lack of competitive substitutes?

  1. A
    Imperfect competition
  2. B
    Oligopoly
  3. C
    Perfect competition
  4. D
    Monopoly

Solution & Step-by-step Explanation

In a monopoly market structure, a single vendor controls the supply completely with significant barriers to entry, enabling the extraction of max pricing power and highest profit yields.

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Which market conditions enable firms to earn high/supernormal profits over an extended period due to lack of competitive substitutes?
A
Imperfect competition
B
Oligopoly
C
Perfect competition
D
Monopoly

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