An A level Economi

1. Monopolists of the world

2. What is a monopoly?
A monopoly is the sole supplier of a product
Least competitive market structure
The monopolist’s are the price setters
High barriers of entry
Sloping demand curve
Famous board game

3. Advantages and disadvantages of
monopolies
Advantages Disadvantages
Supernormal profits gives monopolists funds Supernormal profits is a disincentive to be
for research and development more efficient to develop new products
Monopoly power means the firms will have Monopolists do not produce at the most
financial power to match large overseas productively efficient point of output (i.e. at
competitors the lowest point of the average cost curve)
Economies of scale. Increased output will Monopolists may undertake price
lead to a decrease in average costs of discrimination to raise producer surplus and
production. These can be passed on reduce consumer surplus
to consumers in the form of lower
prices.

4. Examples of monopolies

7. The Justice Department and the states believe that Microsoft
has used its monopoly in operating system software to
protect its dominance and eliminate competitors.
The government says that in the long run, consumers will be
harmed, because there will be less competition and fewer
choices.

8.  In March 2004 the European Union brought antitrust legal
action against the company, citing it abused its dominance
with the Windows OS, resulting in a judgment of
€497 million ($613 million) and to produce new versions of
Windows XP without Windows Media Player, Windows XP
Home Edition N and Windows XP Professional N

10. Which of the following is a
characteristic of pure monopoly?
(A) one firm, complete market power.
(B) low barriers to entry.
(C) the absence of market power.
(D) firm acts as a price taker.

11. How many games of Monopoly
have been sold worldwide?
A) 350 Million
B) 215 Million
C) 278 Million
D) 179 Million

12. How long was the longest
game of monopoly
A) 70 days
B) One year
C) 38 days
D) 3 days