-The above figure illustrates a single-price unregulated monopolist. If the monopolist maximizes its profit, the consumer surplus equals
A) $20,000.
B) $10,000.
C) $45,000.
D) $40,000.

Question

-The above figure illustrates a single-price unregulated monopolist. If the monopolist maximizes its profit, the consumer surplus equals
A) $20,000. 
B) $10,000. 
C) $45,000. 
D) $40,000.

Quizplus · Accepted Answer

Consumer surplus is the area below the demand curve and above the price line. In this case, the consumer surplus is the area of the triangle with a base of 10 and a height of 2. The area of a triangle is (1/2) * base * height, so the consumer surplus is (1/2) * 10 * 2 = $10,000.

-The Above Figure Illustrates a Single-Price Unregulated Monopolist