Monopolies arise when there are
A) many substitutes but there are no barriers to entry.
B) no close substitutes and there are no barriers to entry.
C) no close substitutes and there are barriers to entry.
D) many substitutes and there barriers to entry.
E) None of the above answers are correct because the existence of a monopoly has nothing to do with the presence or absence of barriers to entry.

Question

Quizplus · Accepted Answer

Monopolies arise when there are no close substitutes and there are barriers to entry. This means that there is only one supplier of a particular good or service, and it is difficult or impossible for other firms to enter the market and compete. This lack of competition can lead to higher prices and reduced output, and can be harmful to consumers and the economy as a whole.

Monopolies Arise When There Are