The accompanying figure depicts a generalized downward-sloping market demand (D) curve for a product. It also shows the firm's relevant marginal revenue (MR) curve and marginal cost (MC) curve. Refer to this figure to answer the questions.
-For a monopoly that charges a single price of P₁, which area(s) are designated as consumer surplus?

Question

The accompanying figure depicts a generalized downward-sloping market demand (D) curve for a product. It also shows the firm's relevant marginal revenue (MR) curve and marginal cost (MC) curve. Refer to this figure to answer the questions.

-For a monopoly that charges a single price of P₁, which area(s) are designated as consumer surplus?

Quizplus · Accepted Answer

Consumer surplus is the area above the price level and below the demand curve. In a monopoly, this area is typically represented as area A.

The Accompanying Figure Depicts a Generalized Downward-Sloping Market Demand (D)