Explore BrainMass
Share

Deadweight loss of a monopoly

This content was STOLEN from BrainMass.com - View the original, and get the already-completed solution here!

Explain why the deadweight loss of a monopoly may vary from standard estimates.

© BrainMass Inc. brainmass.com October 25, 2018, 7:17 am ad1c9bdddf
https://brainmass.com/economics/monopolies/deadweight-loss-of-a-monopoly-498043

Solution Preview

In the below section, the deadweight losses in monopoly is explained. These are the losses that occur due to inefficiencies in the economy. There are several reasons behind the deviation from the standard estimates of these losses. The parameters responsible for these variations are also discussed.

Deadweight loss represents the net loss to the society due to economic inefficiency. Resource misallocation leads to economic inefficiency. It is the loss on the part of consumers but nobody gains from these losses. In a monopoly, there is only one seller that owns a key resource or has exclusive rights to produce or have any technical advantage. The output is reduced ...

Solution Summary

Detailed response to the query with references. In the below section, the deadweight losses in monopoly is explained. These are the losses that occur due to inefficiencies in the economy. There are several reasons behind the deviation from the standard estimates of these losses. The parameters responsible for these variations are also discussed.

$2.19
See Also This Related BrainMass Solution

Deadweight loss of monopoly

Explain why a certain triangular area is a measure of the deadweight loss of monopoly. What information do you require in order to calculate the size of this triangle?

View Full Posting Details