Question

True False-Ambiguous and Explain why 6. Suppose that a single-price monopolist bought up all the firms in a competitive industry and was able to block new firms from entering. In this case, consumer surplus would fall, a deadweight loss would arise, and the firm would earn positive economic profits. Draw a graph.

Answer 1

Ans.

The distinguishing characteristics of monopoly are that a single firm represents the market and significant barriers to entry exist.
When a monopolist firms will start taking over the other firms and create monopoly.
Monopolies will frequently seek rent seeking behavior for exercises investing energy or cash on exercises that are not identified with the creation of the great or administration however planned to build the market force and benefit of the firm. For instance, major soda organizations, for example, Coke or Pepsi, will offer millions to a college or arena in the event that they are permitted to be the sole soda merchant. In like manner athletic wear firms may offer a college installments or limits on the off chance that they are permitted to be the sole merchant of attire. These uses are not identified with the creation of the great or administration however give them a monopoly in the particular markets.
Graph can be presented as follows:

Monopolies S Consumer Surplus MC P. DWL P. pe Producer Surplus IDemand MR Qm Qpc