Economics 1021A/B Chapter 13-18: Econ Exam Chapters 13-18

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ECON 1021A/B Full Course Notes
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ECON 1021A/B Full Course Notes
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Main topics: how monopolies arise, single-price monopolies, single-price monopolies vs. A monopoly is a market: that produces a good or service for which no close substitute exists. In which there is one supplier that is protected from competition by a barrier to entry preventing the entry of new firms: If there were two firms supplying in the market, then the cost would be 10 cents instead of 5 cents to produce 4 million kilowatts (quantity) Lrac is still sloping down at intersection with market demand. An ownership barrier to entry occurs if one firm owns a significant portion of a key resource. Most examples are in industries that sell natural resources (diamonds, nickel, gravel, etc. ) Legal barriers to entry create a legal monopoly. Monopoly price-setting strategies: monopoly sets it own price and monopoly faces a market constraint, to sell a larger quantity, the monopoly must set a lower price.

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