The following figure shows the costs and revenue curves of a firm in a monopoly market.

-Refer to the figure above.If this monopolist engages in the first-degree price discrimination,the consumer surplus in this market is equal to ________.

Question

The following figure shows the costs and revenue curves of a firm in a monopoly market.
 
-Refer to the figure above.If this monopolist engages in the first-degree price discrimination,the consumer surplus in this market is equal to ________.

Quizplus · Accepted Answer

First-degree price discrimination, also known as perfect price discrimination, occurs when a monopolist charges each consumer the maximum they are willing to pay, effectively capturing all the consumer surplus. Therefore, the consumer surplus is reduced to zero.

The Following Figure Shows the Costs and Revenue Curves of a Firm