ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -3.1 Market Power Introduction A monopoly is defined as a single firm in an industry with no close substitutes. An industry is defined as a group of firms that produce the same good. Monopoly = A single firm in an industry with no close substitutes.

Detailed explanation-2: -The Pure Monopoly A pure monopoly is a single seller in a market or sector with high barriers to entry such as significant startup costs whose product has no substitutes.

Detailed explanation-3: -In a pure monopoly, only one company exists, and it determines all terms, conditions, rules, and pricing.

Detailed explanation-4: -Pure Monopoly-Characteristics Single seller One firm is the sole producer of a specific good or service. Firm and industry are synonymous. No close substitutes for the firm’s product.