Suppose We Compare Two Monopolists with Identical Cost and Demand

question 104

Multiple Choice

Suppose we compare two monopolists with identical cost and demand conditions.Monopolist A charges a single price.Monopolist B engages in price discrimination,charging a different price for different units of the product.Which one of the following statements is correct?

• A)A will produce less than B,resulting in smaller deadweight loss.
• B)A and B will both produce the same amount.
• C)B will generally produce more than A,resulting in less deadweight loss.
• D)A will produce more than B,resulting in larger deadweight loss.
• E)B will produce less than A,resulting in a larger deadweight loss.

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