In a monopoly, when the quantity supplied is reduced below the socially optimal level, what economic concept is illustrated by the loss of consumer and producer surplus?

In a monopoly, when the quantity supplied is lower than what is best for society, it leads to a loss of both consumer and producer surplus. Consumer surplus is the extra benefit consumers get when they pay less than what they are willing to pay, while producer surplus is the extra profit producers make when they sell at a higher price than their cost. When a monopoly restricts supply, fewer goods are available, causing prices to rise and consumers to buy less. This situation creates a deadweight loss, which means that the total economic welfare decreases because some potential trades that could benefit both consumers and producers do not happen. For example, if a monopoly sells fewer units of a product at a high price, some consumers who would have bought it at a lower price miss out, and the producer also loses out on potential sales.