ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A monopoly is a firm who is the sole seller of its product, and where there are no close substitutes. An unregulated monopoly has market power and can influence prices. Examples: Microsoft and Windows, DeBeers and diamonds, your local natural gas company.

Detailed explanation-2: -There are No Close Substitutes-There will be a competition if other firms are selling similar kinds of products. Hence in a monopoly market, there must be no close substitute for the product.

Detailed explanation-3: -A monopoly in simple terms means there is only one supplier of the product in the market. There is no market competition in a monopoly. A monopoly market is characterized by price discrimination, price maker, high-profit margin, single seller market, and difficulty in entry markets by other sellers.

Detailed explanation-4: -A monopolist is a firm that is the only producer of a good that has no close substitutes. An industry controlled by a monopolist is known as a monopoly, e.g. De Beers. The ability of a monopolist to raise its price above the competitive level by reducing output is known as market power.

Detailed explanation-5: -A monopoly is when a single company produces goods with no close substitute, while an oligopoly is when a small number of relatively large companies produce similar, but slightly different goods.