Higher prices.compared to a competitive market, firms with monopoly power can set higher prices.
Allocative inefficiency. Because the price is more than MC in a monopoly, it is allocatively inefficient.
In a competitive market, the cost of the good would be cheaper. The triangle represents a dead-weight welfare loss caused by a monopoly. (This is the difference between the excess of the producer and the surplus of the consumer)
Productive inefficiency. A monopoly is productively inefficient because the output does not occur at the lowest point on the AC curve.
X – Inefficiency.A monopoly, it is believed, has less motivation to lower costs because it is not competing with other businesses. As a result, the AC curve is higher than it ought to be.
Diseconomies of scale - If a monopoly grows too large, it may suffer from diseconomies of scale - higher average costs as the company grows large
Worse quality. Lack of competition may also lead to less innovative products.
Suppliers will be charged greater prices. Monopolies may use their supernormal profits and monopsony power to pay lower prices to suppliers.