Why Does a Monopoly Cause a Deadweight Loss

question 66

Multiple Choice

Why does a monopoly cause a deadweight loss?

• A)because it does not produce some output for which marginal benefit exceeds marginal cost
• B)because it appropriates a portion of consumer surplus for itself
• C)because it increases producer surplus at the expense of consumer surplus
• D)because it does not produce some output for which demand exceeds supply

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Definitions:

Extraordinary Challenge

A task or situation that is exceptionally difficult and requires unusual effort or resources to overcome.

Over-Extend

To stretch oneself too thin, either financially, emotionally, or physically, beyond one's capacity or resources.

Mastery Goal Orientation

A focus on developing competence and understanding in tasks, rather than primarily aiming to outperform others.

Mandarin

A major group of Chinese dialects spoken across northern and southwestern China, also the official state language of China.