FIGURE 12- 3 -Refer to Figure 12- 3. Comparing the Perfectly Competitive Equilibrium

question 33

Multiple Choice

FIGURE 12- 3
-Refer to Figure 12- 3. Comparing the perfectly competitive equilibrium to the monopoly equilibrium, the reduction in consumer surplus due to monopoly is outlined by

• A) P2P3E.
• B) BCE.
• C) P2EP4.
• D) P2ECP3.
• E) q1CEq2.

---

Definitions:

Principal

The primary individual or entity involved in a transaction or contract, or a sum of money lent or invested on which interest is paid.

Actual Authority

The express and implied powers granted by a principal to an agent to enter into contracts or make decisions on behalf of the principal.

Apparent Authority

A doctrine in law where a principal leads a third party to believe that an agent has the authority to act on the principal's behalf, even if the agent doesn't have actual authority.

Agency Contract

A legal agreement wherein one party (the agent) agrees to act on behalf of another party (the principal) in a business transaction or other matter.