What is a monopoly?

• What is a monopoly?:

  • A monopoly occurs when there is only one producer in an industry​
• • This provides the monopolist with market power  leading to higher prices and abnormal profits.  Monopoly power is the ability of a firm to set prices.  ​
• • Monopolies can exploit consumers by charging high prices.  Therefore, monopolies are regulated in order to protect the customer.​
• In a monopoly there are no close substitutes and high barriers to entry