The diagram below shows the demand and supply curves in a perfectly competitive market.
FIGURE 12- 5
-When comparing a monopoly equilibrium to a competitive market equilibrium,the consumer suffers two types of losses.They are
A)the deadweight loss due to the output that is produced beyond the competitive level,and the transfer of consumer surplus to the monopolist
B)the deadweight loss due to the output that is produced and the reduced incentive for innovation by the monopolist.
C)the loss of both consumer surplus and producer surplus.
D)a loss of consumer surplus due to the output that is not produced,and the transfer of consumer surplus to the monopolist.
E)the deadweight loss due to the output that is not produced and the transfer of producer surplus to the monopolist.

Question

The diagram below shows the demand and supply curves in a perfectly competitive market.
  FIGURE 12- 5
-When comparing a monopoly equilibrium to a competitive market equilibrium,the consumer suffers two types of losses.They are
A)the deadweight loss due to the output that is produced beyond the competitive level,and the transfer of consumer surplus to the monopolist 
B)the deadweight loss due to the output that is produced and the reduced incentive for innovation by the monopolist. 
C)the loss of both consumer surplus and producer surplus. 
D)a loss of consumer surplus due to the output that is not produced,and the transfer of consumer surplus to the monopolist. 
E)the deadweight loss due to the output that is not produced and the transfer of producer surplus to the monopolist.

Quizplus · Accepted Answer

In a monopoly equilibrium, the output produced is lower than the competitive level, leading to a loss of consumer surplus due to the fewer available goods. Additionally, the monopolist can charge a higher price, resulting in a transfer of consumer surplus to the monopolist. Therefore, the consumer suffers two types of losses: a loss of consumer surplus due to the output that is not produced and a transfer of consumer surplus to the monopolist.

The Diagram Below Shows the Demand and Supply Curves in a Perfectly