A monopoly is a firm that is the only seller of a good or service that does not have a close substitute. Monopolies have very strong barriers to entry.

Give examples for perfectly competitive and monopoly market structures. Describe how a firm that would meet the conditions of a perfectly competitive and monopoly market structures.

Compare the efficiency and profit maximization conditions for perfectly competitive and monopoly market structures. How do these differences contribute to deadweight loss in a monopoly market?

Can you think of reasons why a monopoly might decide on their own to increase production and lower prices to earn an acceptable profit rather than maximize profits?