If a firm has market power and marginal cost is constant rel

If a firm has market power and marginal cost is constant relative to perfect competition:

consumer surplus is lower, producer surplus is lower, and total surplus is lower.

consumer surplus is lower, producer surplus is higher, and total surplus is lower.

consumer surplus is lower, producer surplus is higher, and total surplus is higher.

consumer surplus is higher, producer surplus is lower, and total surplus is lower.

Solution

If a firm having market power is producing at a constant marginal cost relative to perfect competition then the consumer surplus is lower, producer surplus is higher, and total surplus is lower.

When a If a firm having market power is charging a price equal to marginal cost, there is deadweight loss due to which total surplus is lower.