The "deadweight loss" from a monopoly refers to
A)the portion of a monopolist's profits that are above the competitive profit level.
B)the increase in price due to the monopolization of a market.
C)the inefficient use of factors of production by a monopoly.
D)the loss of consumer surplus due to the monopolization of a market that is not transferred to another economic actor.

Question

Quizplus · Accepted Answer

Deadweight loss refers to the loss of consumer surplus and overall welfare that results from a monopoly's ability to restrict output and raise prices. This represents a net loss to society, as the surplus that could have been generated by a competitive market is not being realized. The other choices may be related to the effects of a monopoly, but do not specifically capture the concept of deadweight loss.

The "Deadweight Loss" from a Monopoly Refers to