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, meaning that as the price decreases, the quantity demanded increases. This is because there are no close substitutes for the monopolistic product or service, giving the monopolist market power to set prices at a higher level than in a perfectly competitive market. Barriers to entry also play a role in maintaining a monopolistic position for the firm in the long run.

Monopoly Is Characterized by