Most markets are not monopolies in the real world because
A)firms usually face downward-sloping demand curves.
B)supply curves slope upward.
C)firms usually equate price with marginal cost.
D)there are reasonable substitutes for most goods.

Question

Quizplus · Accepted Answer

Most markets are not monopolies because there are reasonable substitutes for most goods. This means that if one firm tries to charge a high price, consumers can easily switch to another similar product, thereby reducing the monopolistic power of any one firm. In a competitive market, firms cannot charge a price higher than the market price without risking losing customers to their competitors. Therefore, there is no incentive for a firm to become a monopoly in most markets.

Most Markets Are Not Monopolies in the Real World Because