If it is not possible for a pharmaceutical drug maker to sell its generic cholesterol reducing drug along with some name brand cholesterol reducing drugs, we have an example of
A) monopoly due to ownership of key resources.
B) monopoly due to governmental entry restrictions.
C) monopoly due to economies of scale.
D) pure competition.

Question

Quizplus · Accepted Answer

The inability of a pharmaceutical drug maker to sell its generic cholesterol reducing drug along with some name brand cholesterol reducing drugs suggests that there are governmental entry restrictions in the market, which is a type of monopoly. The government enables or enacts restrictions on who can enter the industry, and this licensing or permitting process is a barrier to entry for firms that might like to compete in the market.

If It Is Not Possible for a Pharmaceutical Drug Maker