1. Sources of monopoly power A monopoly, unlike a perfectly competitive firm, has some market power. Thus, it can raise its price, within limits, without quantity demanded falling to zero. The main way manopolies retain their market power is through barriers to entry, which prevent other companies from entering monopolized markets and competing for customers: Consider the market for natural gas. In this industry, low average total costs are obtained only through large-scale production. In other words, the initiol cost of setting up all the necessary pipes and hoses makes it risky and most likely unprofitable for a competitor to enter the market. Which of the following best explains the barners to entry that exist in this scenario? Exclusive ownership of a necessary resource Economies of scate Legal barners