Monopoly is a market situation where there is only one seller of a product or service with no close substitutes. A monopoly firm is a price maker that can determine prices to maximize profits. Under monopoly, the demand curve is the average revenue curve, which slopes downward. Marginal revenue is also downward sloping. In the short run, a monopoly can earn super-normal profits, normal profits, or minimize losses. In the long run, monopoly equilibrium occurs where marginal revenue equals marginal cost. A monopoly may also engage in price discrimination, charging different prices to different customers to increase total revenue and profits.
Students should be able to:
Carry out diagrammatic analysis of the market structure in both the short and long run
Understand the importance of advertising and differentiation for the model of monopolistic competition and be able to contrast this with other market structures.
Students should be able to explain and evaluate the efficiency of monopolistic competition
Students should be able to:
Carry out diagrammatic analysis of the market structure in both the short and long run
Understand the importance of advertising and differentiation for the model of monopolistic competition and be able to contrast this with other market structures.
Students should be able to explain and evaluate the efficiency of monopolistic competition
This PPT includes Oligopoly Market. It is explained in detail.
This is for educational purpose only. If you own any of the content please let me know. We are not here to hurt anyone's emotion. Please try to co-operate and use this for educational purposes only.
Monopoly - Profit-Maximization in Monopoly - EconomicsFaHaD .H. NooR
Monopoly Economics
A monopoly (from Greek μόνος mónos ["alone" or "single"] and πωλεῖν pōleîn ["to sell"]) exists when a specific person or enterprise is the only supplier of a particular commodity. This contrasts with a monopsony which relates to a single entity's control of a market to purchase a good or service, and with oligopoly which consists of a few sellers dominating a market).[2] Monopolies are thus characterized by a lack of economic competition to produce the good or service, a lack of viable substitute goods, and the possibility of a high monopoly price well above the seller's marginal cost that leads to a high monopoly profit.[3] The verb monopolise or monopolize refers to the process by which a company gains the ability to raise prices or exclude competitors. In economics, a monopoly is a single seller. In law, a monopoly is a business entity that has significant market power, that is, the power to charge overly high prices.[4] Although monopolies may be big businesses, size is not a characteristic of a monopoly. A small business may still have the power to raise prices in a small industry (or market).[4]
A monopoly is distinguished from a monopsony, in which there is only one buyer of a product or service; a monopoly may also have monopsony control of a sector of a market. Likewise, a monopoly should be distinguished from a cartel (a form of oligopoly), in which several providers act together to coordinate services, prices or sale of goods. Monopolies, monopsonies and oligopolies are all situations in which one or a few entities have market power and therefore interact with their customers (monopoly or oligopoly), or suppliers (monopsony) in ways that distort the market.[citation needed]
Monopolies can be established by a government, form naturally, or form by integration.
In many jurisdictions, competition laws restrict monopolies. Holding a dominant position or a monopoly in a market is often not illegal in itself, however certain categories of behavior can be considered abusive and therefore incur legal sanctions when business is dominant. A government-granted monopoly or legal monopoly, by contrast, is sanctioned by the state, often to provide an incentive to invest in a risky venture or enrich a domestic interest group. Patents, copyrights, and trademarks are sometimes used as examples of government-granted monopolies. The government may also reserve the venture for itself, thus forming a government monopoly
Students should be able to:
Understand the assumptions of perfect competition and be able to explain the behaviour of firms in this market structure.
Understand the significance of firms as price-takers in perfectly competitive markets. An understanding of the meaning of shut-down point is required. The impact of entry into and exit from the industry should be considered.
Equilibrium of Firm Under Perfect CompetitionPiyush Kumar
The ppt incorporates lots of animations for clear explanation on graphs and curves, it's better to download it first and then surely you will be cherished with it
Equilibrium of firm and Industry under Perfect CompetitionBikash Kumar
Macro Economics
For downloading this contact- bikashkumar.bk100@gmail.com
Prepared by Students of University of Rajshahi
Md. Sultan Mahmud
Md. Shaon Mollah
Md. Mamun Miah
Md. Abid Hasan
Shimul Kumar Mondal
Students should be able to:
Understand the distinction between normal and supernormal profit
Explain and illustrate the concept of profit maximisation using marginal cost and marginal revenue
This PPT includes Oligopoly Market. It is explained in detail.
This is for educational purpose only. If you own any of the content please let me know. We are not here to hurt anyone's emotion. Please try to co-operate and use this for educational purposes only.
Monopoly - Profit-Maximization in Monopoly - EconomicsFaHaD .H. NooR
Monopoly Economics
A monopoly (from Greek μόνος mónos ["alone" or "single"] and πωλεῖν pōleîn ["to sell"]) exists when a specific person or enterprise is the only supplier of a particular commodity. This contrasts with a monopsony which relates to a single entity's control of a market to purchase a good or service, and with oligopoly which consists of a few sellers dominating a market).[2] Monopolies are thus characterized by a lack of economic competition to produce the good or service, a lack of viable substitute goods, and the possibility of a high monopoly price well above the seller's marginal cost that leads to a high monopoly profit.[3] The verb monopolise or monopolize refers to the process by which a company gains the ability to raise prices or exclude competitors. In economics, a monopoly is a single seller. In law, a monopoly is a business entity that has significant market power, that is, the power to charge overly high prices.[4] Although monopolies may be big businesses, size is not a characteristic of a monopoly. A small business may still have the power to raise prices in a small industry (or market).[4]
A monopoly is distinguished from a monopsony, in which there is only one buyer of a product or service; a monopoly may also have monopsony control of a sector of a market. Likewise, a monopoly should be distinguished from a cartel (a form of oligopoly), in which several providers act together to coordinate services, prices or sale of goods. Monopolies, monopsonies and oligopolies are all situations in which one or a few entities have market power and therefore interact with their customers (monopoly or oligopoly), or suppliers (monopsony) in ways that distort the market.[citation needed]
Monopolies can be established by a government, form naturally, or form by integration.
In many jurisdictions, competition laws restrict monopolies. Holding a dominant position or a monopoly in a market is often not illegal in itself, however certain categories of behavior can be considered abusive and therefore incur legal sanctions when business is dominant. A government-granted monopoly or legal monopoly, by contrast, is sanctioned by the state, often to provide an incentive to invest in a risky venture or enrich a domestic interest group. Patents, copyrights, and trademarks are sometimes used as examples of government-granted monopolies. The government may also reserve the venture for itself, thus forming a government monopoly
Students should be able to:
Understand the assumptions of perfect competition and be able to explain the behaviour of firms in this market structure.
Understand the significance of firms as price-takers in perfectly competitive markets. An understanding of the meaning of shut-down point is required. The impact of entry into and exit from the industry should be considered.
Equilibrium of Firm Under Perfect CompetitionPiyush Kumar
The ppt incorporates lots of animations for clear explanation on graphs and curves, it's better to download it first and then surely you will be cherished with it
Equilibrium of firm and Industry under Perfect CompetitionBikash Kumar
Macro Economics
For downloading this contact- bikashkumar.bk100@gmail.com
Prepared by Students of University of Rajshahi
Md. Sultan Mahmud
Md. Shaon Mollah
Md. Mamun Miah
Md. Abid Hasan
Shimul Kumar Mondal
Students should be able to:
Understand the distinction between normal and supernormal profit
Explain and illustrate the concept of profit maximisation using marginal cost and marginal revenue
Students should be able to:
Understand the characteristics of this model and be able to use them to explain the behaviour of firms in this market structure
Explain and evaluate the differences in efficiency between perfect competition and monopoly
Explain and evaluate the potential costs and benefits of monopoly to both firms and consumers
Tnx group 15
For downloading this contact- bikashkumar.bk100@gmail.com
Prepared by Students of University of Rajshahi
MD: AL AMIN
SAIFUL ISLAM
RUKSANA PARVIN RUPA
SHAMIM MIA
LIMA AKTER
An Engineering & Managerial Economics presentation on Price Determination, topics covered were price determination under Perfect Competition, Monopoly, Duopoly and Oligopoly.
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Cultivating and maintaining discipline within teams is a critical differentiator for successful organisations.
Forward-thinking leaders and business managers understand the impact that discipline has on organisational success. A disciplined workforce operates with clarity, focus, and a shared understanding of expectations, ultimately driving better results, optimising productivity, and facilitating seamless collaboration.
Although discipline is not a one-size-fits-all approach, it can help create a work environment that encourages personal growth and accountability rather than solely relying on punitive measures.
In this deck, you will learn the significance of workplace discipline for organisational success. You’ll also learn
• Four (4) workplace discipline methods you should consider
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RMD24 | Debunking the non-endemic revenue myth Marvin Vacquier Droop | First ...BBPMedia1
Marvin neemt je in deze presentatie mee in de voordelen van non-endemic advertising op retail media netwerken. Hij brengt ook de uitdagingen in beeld die de markt op dit moment heeft op het gebied van retail media voor niet-leveranciers.
Retail media wordt gezien als het nieuwe advertising-medium en ook mediabureaus richten massaal retail media-afdelingen op. Merken die niet in de betreffende winkel liggen staan ook nog niet in de rij om op de retail media netwerken te adverteren. Marvin belicht de uitdagingen die er zijn om echt aansluiting te vinden op die markt van non-endemic advertising.
Unveiling the Secrets How Does Generative AI Work.pdfSam H
At its core, generative artificial intelligence relies on the concept of generative models, which serve as engines that churn out entirely new data resembling their training data. It is like a sculptor who has studied so many forms found in nature and then uses this knowledge to create sculptures from his imagination that have never been seen before anywhere else. If taken to cyberspace, gans work almost the same way.
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1. 1. What is Monopoly?
Monopoly is that situation of market in which there is a single
seller of a product, for example: There is only one firm
dealing in the sale of cooking gas in a particular town. Hence,
monopoly is a market situation in which there is only one
producer of a commodity with no close substitutes.
2. 1.1 Definitions
-According to Prof. Ferguson, “A pure monopoly exists when
there is only one producer in a market. There are no
direct competitors.”
-Mc Connel says, “Pure or absolute monopoly exists when a
single firm is the sole producer for a product for which
there are no close substitutes.”
3. 1.2 Features
1. One seller & large number of buyers: Under monopoly there should be
single producer of the commodity. The buyers of the product are in large
number. Consequently, no buyer can influence the price but the seller
can.
2. Monopoly is also an industry: Under monopoly situation, there is only
one firm & the difference between firm & industry disappears. There is no
difference between the study of a firm and industry.
3. Restrictions on the entry of new firms: There are some restrictions on
the entry of new firms into monopoly industry. There is no competitor o a
monopoly firm.
4. No close substitutes: The commodity produced by the firm should have
no close substitute, otherwise the monopolist will not be able to
determine the price of his commodity as per his discretion.
5. Price maker: Price of the commodity is fully under the control of the
monopolist. In case, the monopolist increases the supply of the
commodity, the price of it will fall. If he reduces the supply, the price of it
will rise. A monopolist may also indulge in price discrimination. In other
words, he may charge different prices of the same product from different
buyers.
4. 2. Demand & revenue under
monopoly
In a monopoly situation there is no difference between firm &
industry. Accordingly, under monopoly situation, firm‟s
demand curve also constitutes industry‟s demand curve.
Demand curve of the monopolist is also average revenue
(AR) curve. It slopes downward. It means if the monopolist
fixes high price, the demand will shrink. On the contrary, if
he fixes low price, the demand will expand. Under monopoly,
average revenue & marginal revenue curves are separate
from one another. Both slope downwards.
Following facts come to light as a result of negative AR & MR:
i. Demand rises with fall in price (AR). Hence, by lowering the
price, a monopolist can sell more units of the commodity.
ii. AR is another name of price per unit, i.e., P=AR.
iii. With fall in price, both AR & MR fall, but falling MR is more.
Rate of fall in MR is usually more than rate of fall in AR.
iv. AR is never 0, but MR may be 0 or even -ve.
6. 3. Determination of price and
equilibrium under monopoly
A monopolist will so determine the price of a product as to
get maximum profit. A monopolist is in equilibrium
when he produces that amount of output which yields
him maximum total profit. A monopolist is also in
equilibrium in the short period when he incurs minimum
loss. Under monopoly, price & equilibrium are
determined by 2 different approaches:
1. TR & TC Analysis
2. MR & MC Analysis
7. 4. TR & TC curve analysis
Monopolist can earn maximum profit by selling that amount
of output at which difference between TR & TC is maximum.
By fixing different prices or by changing the supply of the
product, a monopolist tries to find out the level of output at
which the difference between TR & TC is maximum, i.e., total
profit is maximum. That amount of output at which a
monopolist earns maximum profit will constitute his
equilibrium situation.
9. 5. MR & MC analysis
In case of monopoly, one can know about price determination or
equilibrium position with the help of MR & MC analysis.
According to this analysis, a monopolist will be in equilibrium
when 2 conditions are fulfilled, i.e.,
1. MC=MR
2. MC curve cuts MR curve from below. A monopolist earns
maximum profit when he is in equilibrium.
Price & equilibrium determination under monopoly are studied
with reference to 2 time periods:
A. Short period
B. Long period
11. A. Price determination under short
period or short-run equilibrium
Short-run refers to that period in which time is so short that a monopolist cannot
change fixed factors like: machinery, plant etc. Monopolist can increase
his output in response to increase in demand by changing his variable
factors. Similarly, when demand decreases, the monopolist will reduce his
output by reducing variable factors & by slowing down the intensive use of
fixed factors. A monopolist will face any of the 3 situations in the short
period:
1. Super normal profit: If the price (AR) fixed by the monopolist in
equilibrium is more than his AC, then he will get super normal profits. The
monopolist will produce upto the extent where MC=MR. If the price of
equilibrium output is more than AC then the monopolist will earn super-
normal profit.
2. Normal profit: If in the short run equilibrium MC=MR, the monopolist
price AR=AC, then he will earn only normal profit.
3. Minimum loss: In the short run, the monopolist may incur loss also. If in
the short-run price falls due to depression or fall in demand, the
monopolist may continue his production so long as the low price covers
his AVC. A monopolist in equilibrium, in the short period, may bear
minimum loss equivalent to fixed costs. In this situation, AR=AVC & the
monopolist bears the loss of fixed costs.
13. B. Determination of Long-
run or long-run equilibrium
In the long run, the monopolist will be in equilibrium at a
point where his long-run marginal cost is equal to marginal
revenue. In the long run, because of sufficiently long period
at the disposal of the monopoly firm, all costs can be varied &
supply can be increased in response to increase in demand.
15. Monopoly equilibrium & law
of costs
i. Elasticity of demand: If demand is inelastic, the monopolist will fix high
price of his product. On the contrary, if the demand is elastic, the
monopolist will fix low price per unit. Low price will not only extend
demand & increase the sales, also maximize his profits.
ii. Effect of laws of costs on monopoly price determination: While
fixing the price, a monopolist also takes into consideration cost of
production.
1) Diminishing costs: It means as production increases its cost per unit
goes on diminishing.
2) Increasing costs: It means as production increases, the cost of
production also increases.
3) Constant cost: It is a situation wherein cost of production remains
constant, whether production is more or less.
16. Price discrimination or
discriminating monopoly
Definitions:
In the words of Koutsoylannis,“Price discrimination exists
when the same product is sold at different prices to different
buyers.”
-Dooley,“Discriminatory monopoly means charging different
rates from different customers for the same good or service.”
17. Price & output determination or
equilibrium under discriminating
monopoly
The aim of the monopolist in resorting to price discrimination is to
increase TR & profit. Analysis of price determination under price
discrimination can be made with reference to 2 or more market
conditions. Each discriminating monopolist, in order to maximize his
profit, will produce upto that level where MR=MC. In order to get
maximum profit, 2 conditions must be fulfilled:
1.Get same MR in both markets: If we express MR of market „A‟ as
MR1, & MR of market „B‟ as MR2, then MR of both the markets must be
same, i.e., MR1=MR2.
2. Equality between MR & MC: Another condition of equilibrium is that
MR earned in each market should be equal to the MC of the total output.
If MR of market „A‟ is expressed as MR1 & that of market „B‟ as MR2, &
marginal cost of total output as MC, then the condition of equilibrium will
be written as: MR1=MR2=MC.