ECN 104 Chapter Notes - Chapter 11: Avoidance Speech, Allocative Efficiency, Mira-Bhayandar Municipal Corporation
3 Feb 2017
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Or service the industry controls price depending on demand curve; tries to maximize profit. Single seller an industry where one firm is sole producer/supplier of a good. No close substitutes product is unique. Price-maker monopolist controls total quantity supplied & therefore also. Blocked entry monopolist has no competitors because there are various. Non-price competition product may be standardized (engage mainly in. Monopoly"s demand curve )s the market demand curve, therefore it is downsloping. Monopolist sets price in the elastic region of the demand curve where demand is elastic, decreasing price will increase total revenue & vice versa. Cost data: although firm is a monopoly it hires factors of production in competitive markets and employs same technology, has same cost structure as perfectly competitive markets. Misconceptions about monopoly pricing control price) between total revenue and total cost occurs to maximize profit cost (profit is maximized)
