Download - Monopoly Div.A
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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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