If a monopolist can engage in perfect price discrimination:
A)it produces at the socially efficient level.
B)consumer surplus is maximized.
C)producer surplus is minimized.
D)the government will impose fines on the monopolist.

Question

Quizplus · Accepted Answer

If the monopolist can engage in perfect price discrimination, it is able to charge each individual consumer their maximum willingness to pay for the good or service. This means that the monopolist is able to capture all of the consumer surplus, leaving no deadweight loss as in the case of regular monopolies. As a result, the monopolist produces at the socially efficient level.

If a Monopolist Can Engage in Perfect Price Discrimination