Monopolistic Markets

Joe Danahan Economics 2302 March 17, 2011 Monopolistic markets The term Monopolistic foodstuff is derived from the Greek words monos which sum alone or virtuoso(prenominal) and polien which substance to apportion. It is defined as a situation in which a single company possesss all or or so all of the market for a given fictitious character of harvest-time or service. It is also explained as the exclusive power; or privilege of copeing a commodity; the exclusive power, rights, or privilege of dealing in some denominations, or of transaction in some market, sole command of the traffic in anything, however obtained; as the proprietor of a patented name in given a monopoly of its sale for a frame time. The key characteristics of a Monopolistic Market are as follows: Exclusive dominance of one company to relieve oneself and sell a commodity or service. An example of exclusive go over is the recent ruling by the solid food and Drug dribble disposal; they engender granted KV Pharmaceuticals the sole rights to produce the drug Progesterone. There is no close substitute of the carrefour or service available in the market. Because they are the lonesome(prenominal) suppliers and have no other sets to compete with, the sellers create their own footings. Referring to the previously stated example, the personify of the drug will arugula from intimately $20 dollars a dose up to near $1,500 a dose.

Competition is restricted because of the high immersion barriers. These entry barriers empennage be legal, technological, economical or natural. The firm faces a downwa rd(prenominal) sloping demand curve for its ! product; since the firm is an industry. It means it cant sell more output unless the price is lowered. There are a number of companies who have monopolies on either a market or a product. 5 of these companies include: 1.KV Pharmaceuticals- Recently granted sole rights by the Food and Drug Administration to produce the drug hydroxyprogesterone. 2. galvanizing Companies- with the cost barrier being extremely high, it will delay to be unlikely for potential competitors to...If you want to get a luxuriant essay, order it on our website: OrderCustomPaper.com

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