The following figure shows revenue and cost curves of a monopolist. Figure 10.8 AR: Average revenue curve
MR: Marginal revenue curve
MC: Marginal cost curve
-According to Figure 10.8,the deadweight loss of monopoly is:

Question

The following figure shows revenue and cost curves of a monopolist. Figure 10.8

AR: Average revenue curve
MR: Marginal revenue curve
MC: Marginal cost curve
-According to Figure 10.8,the deadweight loss of monopoly is:

Quizplus · Accepted Answer

The deadweight loss is the area of the triangle formed by the vertical distance between the demand curve and the marginal cost curve, and the horizontal distance between the quantity produced by the monopolist and the quantity that would be produced in a perfectly competitive market. In this case, that triangle is ACD. Thus, the correct answer is C.

The Following Figure Shows Revenue and Cost Curves of a Monopolist