Monopoly power in a market is likely to:
A)increase consumer surplus
B)increase community surplus
C)lead to higher producer surplus
D)lead to lower prices and lower output

Question

Quizplus · Accepted Answer

Monopoly power typically leads to higher producer surplus because the monopolist can set prices above marginal costs, maximizing their profits at the expense of consumer surplus and potentially reducing overall community surplus.

Monopoly Power in a Market Is Likely To