Monopoly is characterized by
A)many close substitutes.
B)no barriers to entry.
C)a downward sloping demand curve.
D)a horizontal demand curve.

Question

Quizplus · Accepted Answer

Monopoly is characterized by a downward sloping demand curve, which means as the firm increases its price, the quantity demanded by consumers decreases. Monopoly firms have the ability to set their own prices as they are the sole provider of a particular good or service, and there are no close substitutes available in the market. Additionally, barriers to entry make it difficult or impossible for new firms to enter the market and compete with the monopoly firm.

Monopoly Is Characterized by