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Question
If marginal cost is constant, what happens to a market if it alters from perfect competition to monopoly without any change in the position of the market demand curve or any variation in costs?
A) Consumer surplus decreases, producer surplus increases and a deadweight loss is created.
B) Consumer surplus decreases, producer surplus decreases and a deadweight loss is created.
C) Consumer surplus increases, producer surplus decreases and a deadweight loss is created.
D) Consumer surplus increases, producer surplus increases and a deadweight loss is created..
Answer
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