Why Does a Monopoly Cause a Deadweight Loss

question 37

Multiple Choice

Why does a monopoly cause a deadweight loss?

• A)because it stops producing output at a point where price is above 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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