Monopoly

By Jesus vergara

What is monopoly?

It's a single seller or a organization that is selling a unique product in the market. In the monopoly market the seller faces no competition because his the sole seller of goods with no substitute. Or is a exclusive possession or control of a supply or a trade in a category of a certain product. This type of thing usually happens when there is a barrier in the industry that allows the single company to operate without competition.
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Advantages and disadvantages of monopoly:

Advantages:

1. research and development: Monopoly's can make super high profits and use it for to fund high costly capital investment spending.

2.Monopolies can be successful firms: A typical firm can have monopoly power in the domestic country but could possibly face effective competition in global markets. Also it can achieve this by being efficient and dynamic. A monopoly is all of the time a sign of success not efficiency. A good example would be google has gained their monopoly power from their best search engines, another one would be apple for gaining it from successful innovation.

3. Can invest in latest technology and machinery in order to be efficient and to avoid competition.

4. Monopoly avoids duplication and hence waste of resources.


Disadvantages:

1. poor level of service

2. no consumer sovereignty

3. Lack of competition may lead to low quality and out dated goods and services.

citations

"Advantages of Monopoly." Economics Help. N.p., n.d. Web. 14 Dec. 2015.

"Market Structures." Market Structures. N.p., n.d. Web. 14 Dec. 2015.

"Apple, A Monopoly? It Could Happen." Forbes. Ed. Roger Kay28. Forbes Magazine, 28 Aug. 2012. Web. 14 Dec. 2015.

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