Figure 15-15

-Refer to Figure 15-15.If the monopoly firm perfectly price discriminates,then consumer surplus amounts to
A) $0.
B) $250.
C) $500.
D) $1,000.

Question

Figure 15-15
 
-Refer to Figure 15-15.If the monopoly firm perfectly price discriminates,then consumer surplus amounts to
A) $0. 
B) $250. 
C) $500. 
D) $1,000.

Quizplus · Accepted Answer

Perfect price discrimination means that the monopoly firm charges each consumer their maximum willingness to pay. This results in the elimination of consumer surplus, as consumers are paying exactly what they value the product at and no more. Therefore, the consumer surplus in this case is $0.

Figure 15-15 -Refer to Figure 15-15.If the Monopoly Firm Perfectly Price Discriminates,then