Monopoly pricing prevents some mutually beneficial trades from taking place.These unrealised mutually beneficial trades are:

Question

Quizplus · Accepted Answer

Monopoly pricing creates a deadweight loss to society because it prevents some mutually beneficial trades from happening. This means that both the consumer and the producer would be better off if the transaction could take place, but the monopoly's pricing strategy makes it impossible. This creates inefficiencies and reduces overall economic welfare.

Monopoly Pricing Prevents Some Mutually Beneficial Trades from Taking Place