Principles of Microeconomics / Unit 8 MIC 0721 short lesson, about 20 seconds
The Inefficiency of Monopoly
Captions available
The idea
At the monopoly quantity price exceeds marginal cost: buyers value another unit above its cost and it goes unmade, failing allocative efficiency. The firm also sits above minimum average cost, failing productive efficiency.
In practice
Doses worth seven dollars that cost five go unmade.
Where people slip
The objection is the missing output, not the high price by itself; the price is the symptom.
Your place on the trail
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