In a monopoly, the firm faces a downward-sloping demand curve. To sell an additional unit of output, the monopolist must lower the price for all units sold. Consequently, the marginal revenue (the revenue from the last unit) is always less than the average revenue (the price per unit). Therefore, the AR curve remains positioned above the MR curve throughout the relevant range of production.

Price discrimination involves charging different prices to different consumers for the same product. While it allows a firm to capture consumer surplus, the total output produced by the firm often remains unchanged compared to a single-price monopoly unless the discrimination allows the firm to serve segments of the market that would otherwise be priced out.

Price discrimination allows a monopolist to maximize total revenue by charging different prices to different consumers based on their willingness and ability to pay. By identifying segments with varying price elasticities of demand, the firm can capture more consumer surplus, charging higher prices to those with inelastic demand and lower prices to those with elastic demand.

In the long run, a perfectly competitive firm will only continue to operate if it can cover its total costs. Therefore, the long-run supply curve is the portion of the long-run marginal cost (LRMC) curve that lies above the minimum point of the long-run average total cost (LRATC) curve.

A monopolist maximizes profit where Marginal Revenue equals Marginal Cost. When demand is less elastic (inelastic), consumers are less sensitive to price changes, allowing the monopolist to raise prices significantly without a proportional drop in quantity demanded, thereby increasing total revenue and profit.

Price discrimination is a strategy used by monopolists to capture consumer surplus and maximize their own profits. It is generally not intended to increase the welfare of the masses; in fact, it often results in a deadweight loss or a reduction in overall consumer welfare compared to a perfectly competitive market.

A collusive oligopoly acts similarly to a monopoly by restricting output to raise prices. However, because the collusion is rarely perfect and firms may have different cost structures or incentives to cheat, the resulting output level typically falls between the competitive level (high output) and the pure monopoly level (low output).

Trade channel discounts are a form of differential pricing. Loss leadership is a strategy often used in product line pricing. Pricing that is non-responsive to changes in demand and cost is characteristic of oligopoly pricing. Basing point pricing involves locational price differentials. Matching these results in the sequence a-3, b-4, c-1, d-2.

In perfect competition, the freedom of entry and exit is the primary mechanism that ensures long-run equilibrium. If firms earn supernormal profits, new firms enter, increasing supply and lowering prices. If firms incur losses, they exit, decreasing supply and raising prices. While perfect knowledge and mobility facilitate this, the freedom of entry and exit is the specific structural reason that eliminates abnormal profits or losses over time.

The kinked demand curve model is used to explain price rigidity in oligopolistic markets. It suggests that firms are reluctant to change prices because rivals will match price cuts but ignore price increases. While the model describes price stability, it is often associated with the implicit collusion or mutual interdependence among firms that prevents price wars. Note: Some academic sources argue it explains price rigidity rather than explicit collusion.