Which of the following is true of the comparison between a non-price discriminating monopoly and a perfectly price discriminating monopoly?
A)The non-price discriminating monopolist will produce a higher amount of output.
B)The non-price discriminating monopolist will have more producer surplus.
C)The non-price discriminating monopolist will impose a greater efficiency loss.
D)The non-price discriminating monopolist will capture more consumer surplus.

Question

Quizplus · Accepted Answer

A non-price discriminating monopoly will set a single price for all units of output, leading to a deadweight loss and reduced efficiency. In contrast, a perfectly price discriminating monopoly will charge each consumer their maximum willingness to pay, resulting in no deadweight loss and higher efficiency. Therefore, the non-price discriminating monopolist imposes a greater efficiency loss.

Which of the Following Is True of the Comparison Between