Figure: Regulated vs Unregulated Monopolist (Figure: Regulated vs Unregulated Monopolist) Refer to thefigure. Calculate the change in consumer surplus from anunregulated monopoly to a regulated monopoly.

Question

Figure: Regulated vs Unregulated Monopolist  (Figure: Regulated vs Unregulated Monopolist) Refer to thefigure. Calculate the change in consumer surplus from anunregulated monopoly to a regulated monopoly.

Quizplus · Accepted Answer

The change in consumer surplus is the area of triangle BCD minus the area of triangle ABD. This is approximately $2,800.

Figure: Regulated Vs Unregulated Monopolist (Figure: Regulated Vs Unregulated