Define Monopoly and explain its features.Explain price discrimination followed in monopoly market.
Q. Define Monopoly
Ans: Monopoly is that market from in which a single producer controls the whole supply of a single commodity which has no close substitutes. It is a condition of production in which a single firm has the power to fix the price of the commodity or the output of the commodity. It is a situation there exists a single control over the market producing a commodity having no substitutes with no possibilities for anyone to enter the industry to compete.
Q. Features of Monopoly
Ans: Features of monopoly are:
i) Absence of competition in the market creates a situation of monopoly; hence the seller faces no threat of competition.