For all types of firms (including monopoly), firms make their profits biggest at the output level in which the marginal revenue and marginal cost curves meet, known as the profit maximizing output. But when a firm is a monopoly, the price that the firm sets is the price level of the demand curve for that amount of output. However, it is better for society if the output level is when the marginal cost and the demand curve meet, which is of a higher output and a lower price than what the monopoly produces. Hence, since society could be better if more of the good is produced, a deadweight loss is created. A monopoly is hence not allocatively efficient.