Suppose the firms in a perfectly competitive industry merge to form a monopoly. Which of the following would NOT occur? a. A rise in total consumer plus producer surplus
b. A deadweight loss
c. A rise in producer surplus
d. A fall in consumer surplus

a. A rise in total consumer plus producer surplus

Explanation:

When a Monopoly is formed, the Producer surplus will increase but the Consumer surplus will decrease. This is because a Monopoly will charge a higher price than a Competitive firm to get more profit as well reduce output as well.

This will result in the transfer of some Consumer surplus to the Producer as well as a Dead-weight loss being formed thereby reducing the Consumer surplus. The total surplus will therefore fall as a result of this merger.

hi,

henry is an economist and wants to understand the relationship between inflation and consumer spending habits. for his research, he needs the consumer price index for 2014 and the inflation rate. based on the prices of goods given, what will he find to be the cpi and inflation rate for 2014? assume that a consumer’s basket for three consecutive years consists of the following:

you dont privide answer choices.

answer - 15% of a inflatation rate is 15% less in cpi