Monopoly and Monopolistic Competition
After studying this chapter, you should be able to understand:
- Monopoly is a market structure, where there is a single seller of the good in the market with no close substitutes for the good.
- Under monopoly, the firm constitutes the industry. Hence, the demand curve of the firm is also the demand curve of the industry.
- The monopolist produces a larger output at a lower price and earns larger profits in the long run than it does in the short run.
- Price discrimination is a situation when different prices are charged from different consumers for the sale of the same good at the same point in time.
- Monopolistic competition is a market structure, where there are many firms in the market selling close ...