Figure 16-2 Watanabe Sensei operates the only martial arts school in Hartfield.For simplicity,assume that consumers have identical demand curves and that Sensei knows what this demand curve is.Figure 16-2 shows this demand curve.
-Refer to Figure 16-2.If Sensei acts as a monopolist and charges the profit-maximizing price,what is the consumer surplus received by his customers?
A)the area A + B + C + D
B)the area A + B + C + D + E
C)the area A + B
D)the area A + C + H

Question

Figure 16-2  Watanabe Sensei operates the only martial arts school in Hartfield.For simplicity,assume that consumers have identical demand curves and that Sensei knows what this demand curve is.Figure 16-2 shows this demand curve.
-Refer to Figure 16-2.If Sensei acts as a monopolist and charges the profit-maximizing price,what is the consumer surplus received by his customers?
A)the area A + B + C + D 
B)the area A + B + C + D + E 
C)the area A + B 
D)the area A + C + H

Quizplus · Accepted Answer

In a monopoly, the consumer surplus is the area above the price level and below the demand curve, up to the quantity sold. This is typically represented by the area A + B in such diagrams.

Figure 16-2 Watanabe Sensei Operates the Only Martial Arts