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Group Members Roll No.

Shalaka bhosle 17

Pooja bhosle 16Chaitali gadre 44

Ruchita ghodpkar 49

Ekta bhonkar 14

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WHAT IS MONOPOLY?

MONO means = ONE

POLY means= SELL

ONE SELLER Or ONE PRODUCER

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MONOPLY

Monopoly is market situation where there isonly single seller with complete control over anindustry.

Features of monoply: Single firm

Anti-thesis competition

No close substitutes Price maker

Downward sloping supply curve.

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FEATURES

Single firm: firm and industry identical.

No substitute: there are no close substitute of

the product. so no choice of buyers. eitherbuy or do without it.

Anti-thesis competition: being a single sourceof supply, there is no competition from anysource

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FEATURES OF MONOPOLY(COND)

Price maker: monopoly is price maker not a price

taker. his price-fixing power is absolute he can vary

price from buyer to buyer as per his wish. there

may be price differentials in a monopoly.

Downward sloping supply curve: monopoly and the

industry being one it face downward sloping curve it

cannot sell more outputs unless price is lowered.

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CONDITIONS:

There are three conditions to be fulfilled in

case of monopoly:

There is single seller or producer of the

product.

There are no close substitutes for the

product.

There are no strong barriers to the entry of

new firms.

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WHAT MAKES MONOPOLY?

Natural source

Possession of technical knowledge

Exclusive ownership of raw materials. Legal source

Economies of large scale

Creation of artificial barreirs

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MONOPOLY VS. COMPETITIVE MARKETS

monopoly and perfect competition mark the

extremes of market structures.

Both monopolies and perfectly competitive

companies minimize cost and maximize

profit.

Both are assumed to have perfectly

competitive factors markets.

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DISTINCTION

Marginal revenue and price:

Product differentiation

Number of competitors: Elasticity of Demand

Profit Maximization

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SHORT-RUN PRICE & OUTPUT DETERMINATION

UNDER MONOPOLY

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LONG RUN PRICE & OUTPUT DETERMINATION

UNDER MONOPOLY

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CONCLUSION

A monopoly is a firm that is the sole seller inits market.

It faces a downward-sloping demand curve

for its product. Like a competitive firm, a monopoly

maximizes profit by producing the quantity at

which marginal cost and marginal revenueare equal.

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CONCLUSION

A monopolists profit-maximizing level of

output is below the level that maximizes the

sum of consumer and producer surplus.

Monopolists can raise their profits by

charging different prices to different buyers

based on their willingness to pay

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