Question

Explain any three features of a monopoly market.

Answer 1

Features of a monopoly market are as follows:

1. Single Seller: A monopoly market is defined by the existence of a single seller or producer, referred to as the 'monopolist' of a commodity, managing the product's supply. Any change in output will have a big impact on the market price because there is only one vendor.
2. Price Market: A price maker or price setter is a monopoly corporation. It is a product's only manufacturer. It is capable of exerting a significant impact on the commodity's market supply and, consequently, price. A price-making corporation is one that possesses market power.
3. Possibility of Price Discrimination: A monopolist may charge various customer groups for their products at varying prices. When a manufacturer sells the same product to many purchasers at two or more different rates for reasons unrelated to variations in the cost of delivering the product to various consumers, this is referred to as price discrimination. For example, many hospitals bill richer patients more for operations while charging poorer people less.