Which of the following would normally be a characteristic of a monopoly? (a) have high economies in size (b) protected by consumers (c) have controls over vital raw materials (d) protected by a limited market which supports only one firm 1

Ans. 1. (a) and (c) only

A monopoly is a type of market structure that has only one producing agent with complete control over the entire market supply. The sole producer enjoys market domination and significant bargaining power over consumers in a market with absolute barriers to entry and exit. A producer archives the status of a monopolist through various ways such as government regulation, exclusive rights of production through patents and/or copyrights, or control over vital raw material(s) required for the production of good or service sold in the market. One of the differentiating characteristics of a monopolist is high economies in size, which it gains over the course of its operation in the market.