The following figures show the demand and cost curves of a perfectly competitive and a monopoly firm respectively. Figure 24.7
D: Average Revenue
AC: Average cost
MC: Marginal cost
MR: Marginal cost
Calculate the deadweight loss in Figure 24.6, if the perfectly competitive industry is monopolized after it had been producing an output of 10, 000 units?
A) The area P2ACP1
B) The area ABC
C) The area P2ABP1
D) The distance AB
E) There is no deadweight loss
Correct Answer:
Verified
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