Figure 8.11 Figure 8.11 shows the cost and demand curves for a monopolist.
-Refer to Figure 8.11.What is the amount of consumer surplus if,instead of monopoly,the industry was organised as a perfectly competitive industry?

Question

Figure 8.11  Figure 8.11 shows the cost and demand curves for a monopolist.
-Refer to Figure 8.11.What is the amount of consumer surplus if,instead of monopoly,the industry was organised as a perfectly competitive industry?

Quizplus · Accepted Answer

In a perfectly competitive industry, consumer surplus is maximized because the price is equal to marginal cost. The consumer surplus is the area above the price level and below the demand curve, which is largest in perfect competition.

Figure 811 Figure 8