Monopolies Definition, Causes & Pricing. Monopoly Market Characteristics One Seller Unique Product—no substitutes Difficult/Impossible to enter or leave.

Slides:



Advertisements
Similar presentations
Ch. 7. The factors that make it difficult to enter a market will determine the type of market structure Start-Up Costs- Technology-
Advertisements

Copyright©2004 South-Western 15 Monopoly. Copyright © 2004 South-Western While a competitive firm is a price taker, a monopoly firm is a price maker.
Copyright©2004 South-Western 15 Monopoly. Copyright © 2004 South-Western What’s Important in Chapter 15 Sources of Monopolies (= Price Makers = Market.
Monopoly A monopoly is the sole supplier of a product with no close substitutes The most important characteristic of a monopolized market is barriers.
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Monopoly u A monopoly is the sole seller of its product.  its product does not.
Introduction A monopoly is a firm that is the sole seller of a product without close substitutes. In this chapter, we study monopoly and contrast it with.
Monopoly - Characteristics
Monopoly While a competitive firm is a price taker, a monopoly firm is a price maker. A firm is considered a monopoly if it is the sole seller of.
Ch. 12: Monopoly  Causes of monopoly  Monopoly pricing and output determination  Performance and efficiency of single-price monopoly and competition.
Copyright©2004 South-Western 15 Monopoly. Copyright © 2004 South-Western A firm is considered a monopoly if... it is the sole seller of its product. its.
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Monopoly u A monopoly is the sole seller of its product.  its product does not.
Chapter 15-1 The market structure of Monopoly
 Firm that is sole seller of product without close substitutes  Price Maker not a Price Taker  There are barriers to entry thru: Monopoly Resources,
Monopoly Chapter 15 Copyright © 2001 by Harcourt, Inc. All rights reserved. Requests for permission to make copies of any part of the work should be mailed.
Monopoly CHAPTER 15.
Copyright © 2004 South-Western Monopoly vs. Competition While a competitive firm is a price taker, a monopoly firm is a price maker. A firm is considered.
Chapter 15 notes Monopolies.
Explorations in Economics
The Four Conditions for Perfect Competition

Copyright©2004 South-Western Monopoly. Copyright © 2004 South-Western While a competitive firm is a price taker, a monopoly firm is a price maker.
Monopoly. Monopoly Monopoly is when the market is dominated by a single seller Monopoly is when the market is dominated by a single seller –They can take.
Michael Parkin ECONOMICS 5e CHAPTER 13 Monopoly 1.
Monopoly ETP Economics 101. Monopoly  A firm is considered a monopoly if...  it is the sole seller of its product.  its product does not have close.
MONOPOLY Why do monopolies arise? Why is MR < P for a monopolist?
Chapter 7: Market Structures Section 2
Monopolistic competition and oligopoly. Monopolistic competition Many firms compete in open market Products are similar but not identical Low barriers.
Microeconomics Unit III: The Theory of the Firm. The selling environment in which a firm produces and sells its product is called the market structure.
Chapter 6 The Two Extremes: Perfect Competition and Pure Monopoly.
LECTURE #13: MICROECONOMICS CHAPTER 15
Chapter 22 Microeconomics Unit III: The Theory of the Firm.
Warm-Up, 11/5 Using a Marginal and Average Costs graph, show a firm that is losing money as some price… Then, place to the right of that a market graph.
Chapter Firms in Competitive Markets 13. What is a Competitive Market? The meaning of competition Competitive market – Market with many buyers and sellers.
MONOPOLY. Monopoly Recall characteristics of a perfectly competitive market: –many buyers and sellers –market participants are “price takers” –economic.
PowerPoint Slides prepared by: Andreea CHIRITESCU Eastern Illinois University Monopoly 1 © 2012 Cengage Learning. All Rights Reserved. May not be copied,
Unit 4, Lesson 10 Competition AOF Business Economics Copyright © 2008–2011 National Academy Foundation. All rights reserved.
MONOPOLY MONOPOLY Asst. Prof. Dr. Serdar AYAN. Causes of Monopoly u Legal restrictions u Patents u Control of a scarce resources u Deliberately-erected.
LESSON 9 PERFECT COMPETITION VERSUS MONOPOLY 9-1 HIGH SCHOOL ECONOMICS 3 RD EDITION © COUNCIL FOR ECONOMIC EDUCATION, NEW YORK, NY Two Resource Markets.
Monopolies!!! Are they good for society?. Monopoly Characteristics: 1. Number of Firms = 1 2. Variety of Goods = None 3. Barriers to Entry = Complete.
1.How do you face competition in your daily life? 2.How does competition apply to economics in a positive and a negative way? 1.How do you face competition.
ECO 1 MONOPOLY AND MONOPOLISTIC COMPETITION Erkmen Giray ASLIM (erkmengirayaslim.com)erkmengirayaslim.com 10/22/2015.
7-1: WHAT IS PERFECT COMPETITION?. Competition  Economists classify markets based on how competitive they are  Market structure: an economic model of.
Copyright©2004 South-Western 15 Monopoly. Copyright © 2004 South-Western Monopoly While a competitive firm is a price taker, a monopoly firm is a price.
Public Goods Common Resources Externalities – Positive or Negative Monopolies and Oligopolies Information Asymmetry When markets fail, governments may.
Imperfect Competition 1 Monopoly. Characteristics of Monopolies 2.
1.  exists when a single firm is the sole producer of a product for which there are no close substitutes. 2.
{ Market Structures SSEMI4c- Identify the basic characteristics of the four market structures.
Monopolies Definition, Causes & Pricing Chapter 15.
Topic 4: Competition and Market Structure. I.Perfect Competition A.Conditions for Pure Competition *Def: Pure Competition 1.Many buyers and sellers participate.
Chapter 15 Monopoly!!. Monopoly the monopoly is the price maker, and the competitive firm is the price taker. A monopoly is when it’s product does not.
Chapter Monopoly 15. In economic terms, why are monopolies bad? Explain. 2.
Monopolies. Monopoly  Characteristics  1. A single producer - only producer of good or service  2. No close substitutes – if consumer does not buy.
Copyright©2004 South-Western 15 Monopoly. Copyright © 2004 South-Western While a competitive firm is a price taker, a monopoly firm is a price maker.
Monopoly 1. Why Monopolies Arise Monopoly –Firm that is the sole seller of a product without close substitutes –Price maker Barriers to entry –Monopoly.
Monopoly 15. Monopoly A firm is considered a monopoly if... it is the sole seller of its product. it is the sole seller of its product. its product does.
Perfect Competition Chapter 7. Competition How do you face it in your lives? How does it affect the economy? In Boxing, what would make competition perfect?
Market Structures How do producers manipulate a market to get what they want?
Copyright©2004 South-Western 3 Monopoly. Copyright © 2004 South-Western While a competitive firm is a price taker, a monopoly firm is a price maker.
What Markets Exist Mr. Wyatt. Perfect Competition It’s the simplest, purest form of the market structures. Lots of firms all producing basically the same.
Monopoly and Other Forms of Imperfect Competition
Chapter 15 Monopoly.
Bellwork What is the difference between a perfectly competitive firm, monopoly and oligopoly? Give examples of each.
Definition, Causes & Pricing Chapter 15
Market Structures SSEMI4c- Identify the basic characteristics of the four market structures.
7-1: What is Perfect Competition?
16 Monopoly CLICKER QUESTIONS Notes and teaching tips: 3, 4, 5, 6, 7, 13, 16, 17, 19, 20,
Topic 4: Competition and Market Structure
Definition, Causes & Antitrust Laws Chapter 15
Definition, Causes & Pricing Chapter 15
Presentation transcript:

Monopolies Definition, Causes & Pricing

Monopoly Market Characteristics One Seller Unique Product—no substitutes Difficult/Impossible to enter or leave industry Limited Information Price Setters (high level of price control)

Examples of Monopolies Electric Utilities Water for your home If the buyer cannot obtain a good elsewhere--owners have a local monopoly Utilities: Electricity, Gas & Water

WHY DO MONOPOLIES ARISE? The fundamental cause of monopoly is Barriers to Entry 3 primary sources of barriers: 1) Ownership of a key resource 2) Government gives one firm the exclusive right to produce 3) Costs of production make a single producer more efficient i.e. Economies of scale

Economies of Scale Definition: when larger firms are more efficient than small firms - As firms increase production => average cost per unit falls - small firms can’t compete! Average Cost Importance: Industries with economies of scale will have larger firms

Government Regulation Antitrust laws (1890) - a collection of statutes aimed at curbing monopoly power by: –Breaking up companies –Preventing mergers –Regulating pricing Perfect Together?

Fair Fight in the Market Place Video…show 15 minutes (end with ADM)

End Result of a Monopoly Monopolies result in a higher price & lower Quantity –Versus perfect competition Monopoly profit greater than zero economic profit Less variety of products, less innovation

Perfect Together? Benefits Costs Reading….

Google a Monopoly?

Why do Monopolies exist?

Feedback: Privacy Policy Feedback
Do Not Sell My Personal Information
About project: SlidePlayer Terms of Service

© 2025 SlidePlayer.com. Inc. All rights reserved.