Use the figure below to answer the following questions. Figure 12.3.3
-Consider Figure 12.3.3.Which area indicates the difference in consumer surplus between a single-price monopoly and a perfectly competitive market?
A)EADH
B)EABH
C)ABD
D)ACD
E)FHDC

Question

Use the figure below to answer the following questions.  Figure 12.3.3
-Consider Figure 12.3.3.Which area indicates the difference in consumer surplus between a single-price monopoly and a perfectly competitive market?
A)EADH 
B)EABH 
C)ABD 
D)ACD 
E)FHDC

Quizplus · Accepted Answer

Area EADH represents the difference in consumer surplus between a single-price monopoly and a perfectly competitive market. In a perfectly competitive market, consumers can buy the product at a lower price and therefore have a higher surplus. In a monopoly, the higher price decreases consumer surplus. Therefore, the difference between the two represents the loss in consumer surplus due to the monopoly.

Use the Figure Below to Answer the Following Questions