profit maximisation - supernormal profits in both the short run and long run
sole seller in a market (pure monopoly)
high barriers to entry
price maker
price discrimination
in the UK, when does a firm have monopoly power?
when firm dominates market with more that 25%market share
pure monopoly examples
regional water companies and British Rail
what is monopoly power influenced by?
barriers to entry
number of competitors
advertising
degree of product differentiation
monopoly power (market power) definition
the ability of a monopoly to raise and maintain price above the level that would prevail under perfect competition. market power can also be exercised, usually to a lesser degree, by firms in oligopoly and monopolistic competition
