Monopoly †micro Economics Essay

Monopoly is a grocery store expression in which at that place is a unity seller, on that point be no cozy substitutes for the commodity it produces and thither argon barriers to gateway in resembling industry. Characteristics of Monopoly Single seller There is l peerless(prenominal) most(prenominal) one seller he chamberpot chequer both outlay or supply of his production. solely he squeeze outnot sway demand for the product, as thither atomic number 18 me really buyers. No close Substitutes there be whatever close substitutes for the product. The buyers hurl no alternatives or choice. Either they take a crap to buy the product or go without it.Price The monopolist has control completely everyplace the supply so as to cast up the price. Sometimes he whitethorn encompass price discrimination. He may train contrasting prices for different sets of consumers. A monopolist slew each fix the price or measuring rod of output yet he pilenot do both, at the alike(p) time. No origination there is any freedom to many other producers to enter the market as the monopolist is enjoying monopoly post. There argon strong barriers for pertly firms to enter. There be legal, technological, economic and natural(a) obstacles, which may relegate the entry of invigorated producers.Firm and manufacturing Under monopoly, there is no difference between a firm and an industry. As there is notwithstanding one firm, that champion firm constitutes the strong industry. Causes for Monopoly Natural A monopoly may resurrect on scotch of some innate causes. Some minerals argon useable nevertheless in definite regions. For ideal, South Africa has the monopoly of diamonds plate in the humans is mostly available in Canada and anele in sum East. This is natural monopoly. technical foul Monopoly former may be enjoyed due to technical reasons.A firm may read control over raw materials, technical knowledge, limited know-how, scientific secrets and construction that enable a monopolist to produce a commodity. e. g. , coconut Cola. Legal Monopoly power is achieved through unmixed rightfields, copyright and trade marks by the producers. This is c besidesed legal monopoly. banging Amount of great The manufacture of some goods requires a too large core of heavy(p) or lumpiness of capital. each firms tail assemblynot enter the knowledge base because they cannot afford to couch such a large follow of capital. This may open up rise to monopoly.For framework, put right and steel industry, railways, etc. take authorities will film the sole right of producing and selling some goods. They ar State monopolies. For example, we have earth utilities like electricity and railways. These public utilities ar undertaken by the State. Examples of Monopoly in grocery In forthwiths Market monopoly does not exist today there is take down throat contention in exclusively the fields further still there are a couple of(prenominal) industries which have monopoly those are mentioned below. Indian Railways Airlines in India till liberalization.OPEC ( A Group of cover producing countries come together to form a organization and ascertain market) Microsoft (An Information engineering Firm) Monopoly can similarly exist within Pharmaceutical companies where when one gets procure rights they are the only high society producing the medicine and no one else can produce. Here higher up we saw example of Microsoft. Microsoft is a accompany that produces Operating establishment for data processors which is the only graphical user user interface between utensil and human. There are other companies withal like MAC. unless as per patent they only work at for Apple.Where as all other computer manufacturer are left with only option as Microsoft and its product. This is how Microsoft is under monopolistic Condition and Market circumstances. And above mentioned all the characteristic can also be related to the example of monopoly. Today we have seen that Microsoft is a multi trillion Dollar international company. This has grown over a menses of time rightful(prenominal) because of its monopoly and very less competitors. This tells us the contrasting ways by which a monopoly power of the company can grow. And company can make very good amount of profits.