-The monopoly illustrated in the figure above is unregulated and charges a single price. The deadweight loss created by the monopoly is
A) $90.00.
B) $0.
C) $22.50.
D) $45.00.

Question

-The monopoly illustrated in the figure above is unregulated and charges a single price. The deadweight loss created by the monopoly is
A) $90.00. 
B) $0. 
C) $22.50. 
D) $45.00.

Quizplus · Accepted Answer

Deadweight loss in a monopoly occurs because the monopolist produces less than the socially optimal quantity, leading to a loss of economic efficiency. This loss is represented by the area of the triangle formed between the demand curve, the marginal cost curve, and the quantity produced by the monopolist. Without seeing the specific figure, the correct answer typically involves calculating the area of this triangle, which involves the difference between the monopolist's price and the marginal cost at the socially optimal quantity, and the difference in quantities. Given the options, $22.50 suggests a calculation based on specific values provided in the figure, which would typically involve 1/2 * base * height for the triangle representing the deadweight loss.

-The Monopoly Illustrated in the Figure Above Is Unregulated and Charges