Asked by
Ashley Lozano
on Oct 27, 2024Verified
In the short run,if a monopoly is forced to charge a price equal to marginal cost:
A) output will fall.
B) the deadweight loss will decrease.
C) consumer surplus will decrease.
D) other firms will enter the industry.
Marginal Cost
The charges incurred for the production of an additional unit of a good or service.
Deadweight Loss
A loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved due to market inefficiencies.
Consumer Surplus
The difference in planned versus actual spending by consumers on a good or service.
- Comprehend the financial consequences of imposing regulations on monopolies, particularly in terms of effects on pricing, production levels, and overall economic effectiveness.
Verified Answer
RS
Learning Objectives
- Comprehend the financial consequences of imposing regulations on monopolies, particularly in terms of effects on pricing, production levels, and overall economic effectiveness.