Monopoly Dead Weight Loss Review- AP Microeconomics

Mr. Clifford explains key economic concepts related to monopolies, including consumer and producer surplus, and deadweight loss. He compares monopolies to perfect competition, highlighting inefficiencies and differences in price and quantity. The video uses graphs to illustrate these concepts, emphasizing how monopolies result in higher prices and lower quantities, leading to deadweight loss.

What is a key difference between a monopoly and a perfectly competitive market?

• Monopolies have lower prices.

• Monopolies have higher consumer surplus.

• Monopolies have a single seller.

• Monopolies produce more goods.

In a monopoly, why is the marginal revenue curve below the demand curve?

• Because monopolies can set any price they want.

• Because monopolies produce at the lowest cost.

• Because monopolies face a downward-sloping demand curve.

• Because monopolies have constant marginal costs.

How does the price in a monopoly compare to that in perfect competition?

• It is the same in both.

• It is higher in a monopoly.

• It fluctuates more in a monopoly.

• It is lower in a monopoly.

What happens to consumer surplus in a monopoly compared to perfect competition?

• It remains the same.

• It decreases.

• It increases.

• It becomes negative.

What is deadweight loss in the context of a monopoly?

• The loss of consumer surplus only.

• The loss of producer surplus only.

• The loss of government revenue.

• The loss of both consumer and producer surplus due to reduced production.