Outcome: Inefficiencies in Monopolies

What you’ll learn to do: explain why a monopoly is inefficient using deadweight loss

In this outcome, you’ll see why monopolies are inefficient. They produce less, at a higher average cost, and charge a higher price than would a combination of firms in a perfectly competitive industry. Because of this, they are neither allocatively or productively efficient.

Here are some of the specific things you’ll learn to do in this section:

  • Differentiate between a single price monopolist and a price discriminating monopolist


The learning activities for this section include the following:

  • Reading: The Inefficiency of Monopoly
  • Reading: Monopolies and Deadweight Loss
  • Reading: Price Discrimination
  • Self Check: Inefficiencies in Monopolies

Take time to review and reflect on each of these activities in order to improve your performance on the assessment for this section.