What is a Monopoly?

a. A monopoly is a single firm that serves an entire market and that may choose to produce at any point on the market demand curve

b.Is a single firm that behaves competitively

c. Is a single firm that produces the most desired good by the society

d.Is a particular case of Duopoly

• The correct answer is a. A monopoly is a single firm that serves an entire market and that may choose to produce at any point on the market demand curve.

A monopoly is a single firm with market power to charge a high price. A monopoly firm arises dues to significant barriers to market entry. A monopoly chooses output at a point along the market demand curve and not the market supply curve because there is no supply curve for a monopoly firm.