Monopolists of the world
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Monopolists of the world
What is a monopoly?A monopoly is the sole supplier of a product
Least competitive market structure
The monopolist’s are the price setters
High barriers of entry
Sloping demand curve
Famous board game
Advantages and disadvantages of monopolies
Advantages Disadvantages
Supernormal profits gives monopolists funds for research and development
Supernormal profits is a disincentive to be more efficient to develop new products
Monopoly power means the firms will have financial power to match large overseas competitors
Monopolists do not produce at the most productively efficient point of output (i.e. at the lowest point of the average cost curve)
Economies of scale. Increased output will lead to a decrease in average costs ofproduction. These can be passed on to consumers in the form of lowerprices.
Monopolists may undertake price discrimination to raise producer surplus and reduce consumer surplus
Examples of monopolies
The Justice Department and the states believe that Microsoft has used its monopoly in operating system software to protect its dominance and eliminate competitors.
The government says that in the long run, consumers will be harmed, because there will be less competition and fewer choices.
In March 2004 the European Union brought antitrust legal action against the company, citing it abused its dominance with the Windows OS, resulting in a judgment of €497 million ($613 million) and to produce new versions of Windows XP without Windows Media Player, Windows XP Home Edition N and Windows XP Professional N
Which of the following is a characteristic of pure monopoly?
(A) one firm, complete market power.
(B) low barriers to entry.
(C) the absence of market power.
(D) firm acts as a price taker.
How many games of Monopoly have been sold worldwide?A) 350 Million
B) 215 Million
C) 278 Million
D) 179 Million
How long was the longest game of monopoly A) 70 days
B) One year
C) 38 days
D) 3 days