1. Evaluate whether the following statements are true or false.Explain the reasoning.

a.The equilibrium outcome in a monopolized market is efficient because the monopolist always produces where marginal cost equals marginal revenue.

b.Demand for all inpatient care is perfectly inelastic. If a drop in the price of smartwatches from $250 to $200 increases the quantity sold from 10,000,000 to 14,000,000 demand is price inelastic.

c. In the presence of a positive externality, a competitive market produces too little of the good.