Monopoly Questions and Answers

QUESTIONS RELATED TO MONOPOLY 1-What is the characteristic of the monopoly? 1 The existence of a single product of the commodity 2 characterized by prices, rising prices usual 3 the relative stability of prices 4 There argon barriers to inclose the exertion monopolist 5 non necessary to advertise some other Monopoly properties. Price control. In a monopoly, and at the expense of tote up in the market one entity to control and demand, and the degree of the price offered and the control exercised by the institution or individual is greater. Predatory price. This feature of the advantages of a monopoly consumers.These are short term market gains when prices dropped to meet the demand of rare product. Suppliers and consumers in a flash benefit from an attempt to monopolize the company to increase the sale of parentage marketing. Price flexibility With regard to the demand for the product or receipts offered by the company monopoly or individual, and is dictated by the pri ce shot of the ratio of the absolute value of the increase in prices and demand in the market. insufficiency of creativity At the expense of absolute control of the market, and monopolies demonstrate a tendency to lose efficiency over a finish of time.With one product lifetime, and innovative design and marketing techniques rear seat. Lack of competition. When the market was designed to serve the monopoly and the lack of commercial competition or the lack of goods and viable products shrinking the scope of perfect competition. 2-How monopoly scratchs Monopoly arises in a variety of circumstances there are types of goods and a renovation does not accept by its nature, or not in the public recreate to multiple producers, its called natural monopolies, for example to provide the city with water, electricity, or the trains running game between two countries.Often assume the state or municipal authorities to manage these services, or to grant a concession to a undercover compan y, subject to strict control. Monopoly may arise in an industry, the growth of a project, and it seized on other projects. Or as a result of crack or merge of small projects in the large-scale project, Monopoly May arise due to agreement between the projects owners in a particular industry to determine the price, or divide markets among themselves, known as (cartel), and in this content there are a number of producers, such agreement among them makes them a monopoly power.Most of the countries have been working on the subject of monopolies control. 3-How we can regulate the monopoly determine at marginal cost Economists have for many decades argued the benefits of setting public utility tariffs on the basis of marginal cost. This view is expressed in many classic economic texts on polity. Price discrimination iodin common objection to marginal-cost pricing is that, in the presence of economies of scale, a wide linear price equal to marginal cost would not llow the adjust fir m to recover sufficient revenue to cover its total costs. Ramsey pricing In those cases where the regulator is unable to set the marginal price for to each one service equal to its marginal cost, economic theory still places underlying ferocity on reducing the deadweight loss. Incremental cost The deadweight-loss hypothesis has a hard time explaining why regulators fail to pursue policies which are competent under the conventional economic theory, such as Ramsey pricing. Price / service stabilityAnother puzzle for the conventional economic approach to regulation is the heavy emphasis on price stability. There is a sizeable amount of designate that price and service stability is one of the primary concerns of regulators. Alternative regulation To encourage the productive efficiency of the monopolist. To eliminate the incentive to waste resources seeking to obtain a position of monopoly. To protect the sunk investment of the monopolist 4-Give some examples of monopoly type of monopolyThe main characteristicexamplesNaturalAccess to rare and not easily uniform elements of productionMonopolies operating in the sphere of production is mineral deposits of strategic magnificence for the national economy technologicalFeature production in this technology is not seemly consumer demand to support many competitive firmsEnterprise for the production of specific goods, such as infrastructure for the operation of natural monopolies GeographicCompetition due to the non-rationality of the territorial modified due to the effect of geographic barriersPublic ransport companies infrastructureInfrastructure network a network that yield products between distant from each other (both in space and in time), economic agentsBackbone enterprises in energy, rail transport , heat, gas and water supply patentUsing a unique patented technologyNatural monopolies are producing high-tech products, such as medicine StateMarkets related to the exclusive jurisdiction of the stateDefen se, aeronautics administrative commandOperating in a command systemNatural monopolies in the administrative-command system