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The following points highlight the eight limits to the power of a monopolist. The limits are: 1. New Entry of Competitors 2. Fear of Substitutes 3. Fear of Public Reactions 4. Fear of Governmental Regulations 5. Consumer’s Surplus of the Commodity 6. Because of the Countervailing Power 7. Fear of Nationalisation 8. Differences in the Elasticities of Demand. Power of a Monopolist # 1. New Entry of Competitors:
New entry of businessmen in the market is rarely barred. Patents, copyrights and government monopolies are possibly the only cases where new competitors cannot come.
How does a Monopolist Reach Equilibrium? whether MC is rising or falling or remaining constant, a monopoly reaches equilibrium provided the following two conditions are fulfilled:
Absolute Control Over Market Supply vs. Absence of Control Over Market Supply:
The following are the main points of distinction between monopoly and perfect competition:
Price-Output Determination in a Multi-Plant Monopoly In this article we will discuss about the price-output determination in a multi-plant monopoly in the long run.
Price-Output Determination in a Multi-Plant Monopoly In this article we will discuss about the price-output determination in a multi-plant monopoly in the long run.
Why does the Monopolist Operate on the Elastic Part of the Demand Curve?
Exam Question # Q.12. What are the Administrative Problems of State Enterprises?
Ans. Since independence, a large number of State enterprises have been established and the State has bee...
Exam Question # Q.11. What are the Problems Faced by Public Sector Enterprises?
Ans. Some of the important problems of the public sector enterprises stated above have been analyzed here and if these problems could ...
Exam Question # Q.10. What is the difference between Partnership and Joint Hindu Family Firm?
Ans. Though both partnership and Joint Hindu Family firm are organized by groups of persons, there are s...
Disadvantages: As against the above advantages, the Joint Hindu Family firm suffers the following disadvantages:
1. There is no encouragement to work hard and earn more, because members who work hard are not properly rewarded and all the co-partners irrespective of the wor...