It selects from its demand curve the price that corresponds to the quantity the firm has chosen to produce in order to earn the maximum profit possible. In the case of monopoly, entry by potential rivals is prohibitively difficult.Ī monopoly does not take the market price as given it determines its own price. Not only does a monopoly firm have the market to itself, but it also need not worry about other firms entering. There are no close substitutes for the good or service a monopoly produces. A monopoly A firm that that is the only producer of a good or service for which there are no close substitutes and for which entry by potential rivals is prohibitively difficult. Monopoly is at the opposite end of the spectrum of market models from perfect competition. Define what is meant by a natural monopoly.List and explain the sources of monopoly power and how they can change over time.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |