When an industry is monopolized, the move from a competitive environment to a monopoly leads to a decrease in consumer surplus and an increase in industry profits in a one-to-one ratio.

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The move to a monopoly typically results in a decrease in consumer surplus due to higher prices and lower output, and an increase in producer surplus (industry profits), but the loss in consumer surplus is not always matched one-to-one by the gain in producer surplus due to the deadweight loss created by the reduction in market efficiency.

When an Industry Is Monopolized, the Move from a Competitive