The Social Cost Associated with the Distortion in Consumption from a Monopoly

question 251

Multiple Choice

The social cost associated with the distortion in consumption from a monopoly price is called

• A) producer surplus.
• B) rent-seeking behavior.
• C) the excess burden of a monopoly.
• D) a network externality.

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Definitions:

Self-Categorisation Theory

A social psychological theory that explains how and why individuals identify with specific social groups and behave according to that group membership.

Pluralistic Norm Theory

A theory suggesting that within a diverse society, multiple norms and values coexist and influence behavior.

Cultural Values Theory

The view that people in groups use members’ opinions about the position valued in the wider culture, and then adjust their views in that direction for social approval reasons.

Group Polarisation

The tendency of a group to make decisions that are more extreme than the initial inclination of its members.