Microeconomics: Market Structure

When firms are competing for your business, you have the advantage. The more firms, the better. With many firms producing a similar product, you get the best price. The competitive market is a healthy market.

Sometimes a firm will buy out its competitors or owns the bulk of a natural resource and is the sole supplier of goods to the market. As a result, it has complete control of the industry. This type of firm is a monopoly. Monopolies disadvantage the consumer because you, as a consumer, will have to accept the price set by the company. There is no choice. You may have a visceral dislike of monopolies, but here you will discover the economic reasons behind your emotional response.

The oligopoly and monopolistic ...

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