Question

In the diagram below, which area represents the deadweight loss from monopoly? 9 2 10 MC AIB G H IMR Demand 1 23 4 5 678 9 10 11 g CDE E H

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Answer #1

Dead weight loss means inefficiency in monopoly. (in Monopoly there is single seller of product)

In monopoly specific price of good for all. Result of the deadweight loss, known as excess burden or inefficiency, is a loss of economic efficiency that can occur when equilibrium is not achieved for good and service.

EH is ans because GH is the area where dead weight loss in market arising from a market being dis equilibrium.

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