MONOPOLY İ
n a perfectly competitive market, there are many firms,
none of which is large in size. In contrast, in a monopolistic market there is only one firm, which is large in size. This one
firm provides all of the market’s supply. Hence, in a
monopolistic market, there is no difference between the firm’s
supply and market supply.
Conditions of Monopoly
These conditions characterize a monopolistic market
structure. First, as mentioned above, there is only one firm
operating in the market. Second, there are high barriers to entry.
These barriers are so high that they prevent any other firm from
entering the market. Third, there are no close substitutes for the
good the monopoly firmproduces. Because there are no close
substitutes, the monopoly does not face any competition.
