Monopoly
Assumptions
Barriers to entry
Barriers to entry
Barriers to entry
Natural Monopoly                   LRAC
Barriers to entry
Barriers to entry
Barriers to entry
Barriers to entry
Demand Curve in Monopoly
Profits in monopoly
Loss in monopoly
Revenue maximization in MonopolyInstead of Profit maximization (MC=MR), amonopolist may choose revenue maximization(MR=0)....
Efficiency in Monopoly
Advantages of Monopoly            Advantages           of Monopoly     Economies     Investment      of scale       in R & D
Economies of scale
Investment in R & D
Comparison of price and output in monopoly andperfect competition
Conclusion             Productively    Charge higher                                             Exercise anti-A monopoly ...
Monopoly
Monopoly
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Monopoly

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Monopoly

  1. 1. Monopoly
  2. 2. Assumptions
  3. 3. Barriers to entry
  4. 4. Barriers to entry
  5. 5. Barriers to entry
  6. 6. Natural Monopoly LRAC
  7. 7. Barriers to entry
  8. 8. Barriers to entry
  9. 9. Barriers to entry
  10. 10. Barriers to entry
  11. 11. Demand Curve in Monopoly
  12. 12. Profits in monopoly
  13. 13. Loss in monopoly
  14. 14. Revenue maximization in MonopolyInstead of Profit maximization (MC=MR), amonopolist may choose revenue maximization(MR=0).Revenue: Output (quantity) x cost of eachoutputProfit: Total revenue- total costsProfit maximization: Profit maximization occurswhen MC = MR (Marginal cost = marginalrevenue)Revenue maximization: Revenue maximizationoccurs when MR=0 (Marginal revenue = 0)
  15. 15. Efficiency in Monopoly
  16. 16. Advantages of Monopoly Advantages of Monopoly Economies Investment of scale in R & D
  17. 17. Economies of scale
  18. 18. Investment in R & D
  19. 19. Comparison of price and output in monopoly andperfect competition
  20. 20. Conclusion Productively Charge higher Exercise anti-A monopoly and prices and competitive is: allocatively produce behaviour. inefficient. lower output.
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