Microeconomics Essay Example | Topics and Well Written Essays - 1500 words - 1

Microeconomics - Essay Example4. Features of monopoly Various features of monopoly be explained with the help of diagrams in this section. The question like how monopolistic firms attain the capability to increase the prices of their product and services is explained with the help of early(a) economic terms. 5. Conclusion The major points discussed in this authorship were summarised in this section. 6. Suggested aras of further research The question how to nurse the interests of the consumers in monopolistic marketplace should be researched further. 7. References The references used for this research were cited in MLA style in this section. schema Monopoly is one of the major microeconomic terms which refer to the total domination of a firm in the market. The monopolistic firms face less competition in the market and they can control the market activities more than effectively than early(a) firms. Monopoly is beneficial to the firms whereas it is against the interest of the humanity. Monopolistic firms can increase the prices of their product and services outlying(prenominal) more than the actual prices because of lack of competition they may face in the market. Monopoly has variant forms like natural, geographic, technological, and government. This paper briefly explains various features of monopoly according to the principles of microeconomics. ... Monopoly is a good market condition for an organization but it is non so good for the consumers. The ability to fix prices of products and services is the main advantage of a monopolistic firm. For example, Microsoft is enjoying monopoly in the operating scheme market in the world at present. They are charging heavily for their Windows operating system because of the absence of any other competitive products. Types of monopoly Based on the nature, monopoly can be classified into different categories like natural, geographic, technological, governmental etc. An industry is said to be a natural monopoly if it produce a desired output at a lower cost than two or more firms. humans utilities like railways, telecommunications, water services, electricity, and mail delivery etc are examples for natural monopoly. These public usefulness services are mainly controlled by the government and cliquish competition is not allowed in these sectors. A natural monopoly and monopoly are entirely different concepts since natural monopoly describes a firms cost structure whereas a monopoly explains market share and market power. It is difficult for small firms to invest in areas with natural monopoly. For example, it is not easy for small firms to invest great amounts needed for setting up a public transporting system like railways or public utility like water supply. Because of globalization, governments now permit private investments in natural monopolistic areas. In other words, the term natural monopoly is going to lose its significance since private companies may challenge the governments in these sectors. For example, BSNL (a public company) was the only telecommunication company in India till two decades before. At present many private companies like