Figure 15-8
THE INEFFICIENCY OF
MONOPOLY. Because a
monopoly charges a price above
marginal cost, not all consumers
who value the good at more than
its cost buy it. Thus, the quantity
produced and sold by a
monopoly is below the socially
efficient level. The deadweight
loss is represented by the area of
the triangle between the demand
curve (which reflects the value of
the good to consumers) and the
marginal-cost curve (which
reflects the costs of the monopoly
producer)