Podcast
Questions and Answers
Why might a monopoly firm choose to sustain losses for a long period of time through price wars or massive advertisement campaigns?
Why might a monopoly firm choose to sustain losses for a long period of time through price wars or massive advertisement campaigns?
In what situation would long-run average costs (LRAC) be lower under a monopoly than if an industry was shared between competitors?
In what situation would long-run average costs (LRAC) be lower under a monopoly than if an industry was shared between competitors?
What term is used to describe the situation where a monopoly produces at a lower quantity and higher price than a competitive market, resulting in societal welfare losses?
What term is used to describe the situation where a monopoly produces at a lower quantity and higher price than a competitive market, resulting in societal welfare losses?
Why do governments often intervene with legislation to limit the ability of firms to form monopolies?
Why do governments often intervene with legislation to limit the ability of firms to form monopolies?
Signup and view all the answers
What is the term that describes the situation where a monopoly could produce at a lower price but does not do so, leading to inefficiency?
What is the term that describes the situation where a monopoly could produce at a lower price but does not do so, leading to inefficiency?
Signup and view all the answers
What is a key characteristic of a monopoly market?
What is a key characteristic of a monopoly market?
Signup and view all the answers
What type of barrier to entry is described as resulting from the industry being more efficient?
What type of barrier to entry is described as resulting from the industry being more efficient?
Signup and view all the answers
Which deliberate action is taken by a monopolist to deter new entrants?
Which deliberate action is taken by a monopolist to deter new entrants?
Signup and view all the answers
What do switching costs refer to in terms of barriers to entry?
What do switching costs refer to in terms of barriers to entry?
Signup and view all the answers
What advantage could a monopolist have due to control of key inputs or economies of scope?
What advantage could a monopolist have due to control of key inputs or economies of scope?
Signup and view all the answers
