If a perfectly competitive industry is monopolized, consumer surplus:
A)can be expected to decrease.
B)usually remains constant.
C)becomes equal to producer surplus.
D)becomes double of producer surplus.
E)increases from zero to a high value.

Question

If a perfectly competitive industry is monopolized, consumer surplus:​
A)can be expected to decrease.
B)usually remains constant.
C)becomes equal to producer surplus.
D)becomes double of producer surplus.
E)increases from zero to a high value.

Quizplus · Accepted Answer

In a perfectly competitive industry, a monopolization reduces competition and the monopolist will raise prices. As a result, consumers will pay a higher price which will decrease consumer surplus.

If a Perfectly Competitive Industry Is Monopolized, Consumer Surplus:​

If a Perfectly Competitive Industry Is Monopolized, Consumer Surplus: