Monopoly

• Monopoly is a market structure which there is only one firm supplying all the goods in an industry. There are barriers to entry into the industry which prevents any competition from other firms. Perfect knowledge does not exist as the monopolist is likely to possess knowledge that other participants in the market do not have.
• Monopolists may find themselves in competition with different markets. (e.g train journeys are provided within a monopoly market structure however there are different forms of transport such as car, bus, taxi)
• Characteristics of a Monopoly?

  * One firm which controls the market

  * Lots of barriers to entry preventing firms from entering the market

  * Restricted knowledge

  * Very high influence on price

  * They produce unique products