The following figure shows the downward sloping demand and marginal revenue [MR] curves of a monopolist.The MR curve intersects the marginal cost [MC] curve at point B.MC is constant at the price level P₁.
Figure 12-1
-Refer to Figure 12-1.If the monopolist cannot price discriminate,consumer surplus will be _____.

Question

The following figure shows the downward sloping demand and marginal revenue [MR] curves of a monopolist.The MR curve intersects the marginal cost [MC] curve at point B.MC is constant at the price level P₁.
Figure 12-1

-Refer to Figure 12-1.If the monopolist cannot price discriminate,consumer surplus will be _____.

Quizplus · Accepted Answer

Consumer surplus is the area below the demand curve and above the price line. If the monopolist cannot price discriminate, it will charge a single price for all units of output. This price will be set at P2, which is the price that maximizes the monopolist's profit. At this price, consumer surplus is equal to P3AP2.

The Following Figure Shows the Downward Sloping Demand and Marginal