Th3.4: Characteristics of Monopoly Flashcards
1
Q
Where does pure monopoly exist?
A
where one firm is the sole seller of a product in a market
2
Q
Pure monopoly rarely exists but how can a firm be legally considered as having monopoly power?
A
if it has more than 25% of the market
3
Q
What does the model assume?
A
there is only one firm in the industry, they short run profit maximise and there are high barriers to entry