Refer to Figure 11-16. The allocative inefficiency caused by a profit-maximizing monopoly amounts to

A) $150.
B) $200.
C) $250.
D) $300.

Question

Refer to Figure 11-16. The allocative inefficiency caused by a profit-maximizing monopoly amounts toA)  $150.B)  $200.C)  $250.D)  $300.

Lyndsey Couloute · Accepted Answer

Final Answer : C, Explanation :  Allocative inefficiency in a monopoly is represented by the deadweight loss, which is the loss of total surplus due to the monopoly setting a higher price and lower quantity than in a competitive market. The correct amount of this inefficiency is $250.

Refer to Figure 11-16. The allocative inefficiency caused by a profit-maximizing monopoly amounts to

A) $150.
B) $200.
C) $250.
D) $300.

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