The social cost of a monopoly is equal to its

A) economic profit.
B) fixed cost.
C) deadweight loss.
D) variable cost.

Question

The social cost of a monopoly is equal to itsA) economic profit.B) fixed cost.C) deadweight loss.D) variable cost.

David Hardy · Accepted Answer

Final Answer : C, Explanation :  The social cost of a monopoly is equal to its deadweight loss, which represents the inefficiency introduced by the monopoly setting prices above marginal cost, leading to reduced output and higher prices than in a competitive market. This results in a loss of consumer and producer surplus that is not transferred to the monopolist, hence a net loss to society.

The social cost of a monopoly is equal to its

A) economic profit.
B) fixed cost.
C) deadweight loss.
D) variable cost.

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