Question

what is meant by monopoly? State any three main features of monopoly.

Answer 1

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☆MONOPOLY:--
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it is an extreme from of market structure where there is a single seller producing a commodity having no close substitute? Under monopoly there is no rival or competitors. The degree of competition in monopoly is nil. 

☆FEATURES:----
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●1. One seller and large number of buyers:
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Monopoly is a form of imperfect market structure where there is only one seller of a product. A monopoly firm may be owned by a person, a few numbers of partners or a joint stock company. 

●2. No close substitute:
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Under monopoly a single producer produces single commodities which have no close substitute

●3. Strong barriers to the entry into the industry exist:
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In a monopoly market there is strong barrier on the entry of new firms. Monopolist faces no competition. 

●4. Nature of demand curve:
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In case of monopoly one firm constitutes the whole industry. The entire demand of the consumers for a product goes to the monopolist. Since the demand curve of the individual consumers lopes downward, the monopolist faces a downward sloping demand curve.

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