5 Questions
What is the key characteristic of a monopoly?
A single seller dominates the market with no close substitute
What creates market power for a monopoly?
Barriers to entry
How does a monopoly maximize profit?
By equating Marginal Revenue (MR) to Marginal Cost (MC)
What happens to the demand curve in a monopoly?
It decreases due to the absence of close substitutes
What is the significance of Marginal Revenue (MR) in a monopoly?
It is used to determine the quantity to produce by equating it with Marginal Cost (MC)
Test your knowledge of monopoly and market power with this quiz. Explore the transition from perfect competition to monopoly, the sources of market power, and the signs of monopoly within a market.
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