Exhibit 9-17 What area in Exhibit 9-17 represents consumer surplus under monopoly without price discrimination?

Question

Exhibit 9-17  What area in Exhibit 9-17 represents consumer surplus under monopoly without price discrimination?

Quizplus · Accepted Answer

Area a represents the consumer surplus under monopoly without price discrimination because it shows the difference between the maximum price consumers are willing to pay and the actual price they pay. The area b represents the monopoly profit while the area c represents the deadweight loss. Areas a+b+e do not represent consumer surplus because they also include the monopoly profit.

Exhibit 9-17 What Area in Exhibit 9-17 Represents Consumer