-The Above Figure Shows the Demand,marginal Revenue,and Cost Curves for a Natural

question 314

Short Answer

-The above figure shows the demand,marginal revenue,and cost curves for a natural monopoly.
a.Which price and quantity is set if the capture theory is correct?
b.If production is at the price and quantity specified in part (a),what area represents the economic profit?
c.If production is at the price and quantity specified in part (a),what area represents the deadweight loss?
d.If production is at the price and quantity specified in part (a),what area represents the consumer surplus?

---

Definitions:

Demand Curve

A graphical representation that illustrates the relationship between the price of a good and the quantity of it that consumers are willing to buy.

Equilibrium Price

The price at which the quantity of goods suppliers are willing to sell equals the quantity consumers are willing to buy, leading to a balance of demand and supply.

Consumer Surplus

The variance between a consumer's maximum price readiness for a product or service and the real payment made.

Marginal Buyer

The consumer whose desire or need for a product is the least among all buyers, often determining the highest price they're willing to pay in a market.