Monopoly

Running Head : MONOPOLY[Writer s Name][Name of Institution] is such a model of commercialize structure , where thither is only one firm or company which produces and supplies the whole securities industry with a sure proceeds . Therefore , in terms of monopoly , the replete(p) market or perseverance consists of only one producer . Pure monopoly roll in the hay hardly practically take place , but there are examples which are very oddment to monopoly . In incident , in many countries such services as adorned gas water , telephone or former(a) ordinary services are governmental monopolies .McConnell and Brue , the authors of famous Economics , key fruit out the following characteristics of monopoly (1 ) a single seller (2 ) no close substitutes of the production (3 ) monopolist can avow the set for the product to a great extent (4 ) there are certain barriers to enter the market , like legal barriers (license , evident , etc ) or possessing special unique resources , and so on (5 ) non-price disputation , or producing standardized products (McConnell Brue , 2004 , 438-439Since a noncompetitive company represents the entire industry , the curve of its demand is identical to the curve of The draw rein of maximation of the profits (MR MC ) is valid for monopolistic market . but , a monopolist does not try to smirch fair(a) cost and has a tendency to lower the amount of the goods produced in to keep the prices higher .

Th is brings to misallocation of the resources ! , so the price in monopolistic market usually is higher than marginal costsPure monopoly is supposed to be not healthy for national economy beca phthisis it a great deal ignores the rules of unaffectionate economic system (in contrast to pure contest , because there is no stimulus for a monopolist to optimise the use of the resources , improve the quality of goods or lower the costs . That is why in to limit possible abuse of monopolistic king governments have to regulate and keep under control monopolistic markets by imposing some taxes or creating other legislative barriers for monopolistsReferencesMcConnell , C .R Brue S .L (2004 ) Economics : Principles , Problems , and Policies . 16 ed . N .Y : McGraw-HillPAGEPAGE 2...If you want to get a full essay, establish it on our website: BestEssayCheap.com

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