Assuming a constant cost industry, consumer surplus would be greater under monopoly than if the industry were perfectly competitive.

Question

Quizplus · Accepted Answer

Consumer surplus is the difference between the amount that consumers are willing to pay for a good or service and the price they actually pay. In a perfectly competitive industry, prices are driven down to the marginal cost of production, resulting in a higher level of consumer surplus than under a monopoly where prices are higher and output is lower.

Assuming a Constant Cost Industry, Consumer Surplus Would Be Greater