1. Sources of monopoly power
A monopolist, unlike a competitive firm, has some market power.
It can raise its price, within limits, without the quantity
demanded falling to zero. The main way it retains its market power
is through barriers to entry—that is, other companies cannot enter
the market to create competition in that particular industry.
Complete the following table by indicating which barrier to
entry appropriately explains why a monopoly exists in each
scenario.
Scenario
Barriers to Entry
Exclusive...