submitted to:prof. darshpreet bedi

8/14/2019 Submitted to:Prof. Darshpreet Bedi

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Submitted to:-Prof. Darshpreet Bedi

Submitted by:-Bhoopendra Mahor

Satyendra singh Rajput

M.B.A. 1ST (B)


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2

Monopoly

A market structure in which only one

producer or seller exists for a product

that has no close substitutes

MagicLamps,Inc.


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Characterstics

Single Sellers

A pure monopoly is an industry in which a single firm is the

sole producer of a good or the sole provider of a service. This

is usually caused by barriers to entry.

No Close Substitutes

The product or service is unique in ways which go beyondbrand identity, and cannot be easily replaced (a monopoly on

water from a certain spring, sold under a certain brand name, is

not a true monopoly; neither is Coca-Cola, even though it is

differentiated from its competition in flavor).


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Price Maker

In a pure monopoly a single firm controls the total supply of the

whole industry and is able to exert a significant degree of control over

the price, by changing the quantity supplied (an example of thiswould be the situation of Viagra before competing drugs emerged). In

subtotal monopolies (for example diamonds or petroleum at present)

a single organization controls enough of the supply that even if it

limits the quantity, or raises prices, the other suppliers will be unable

to make up the difference and take significant amounts of market

share.

Blocked Entry

The reason a pure monopolist has no competitors is that certainbarriers keep would-be competitors from entering the market.

Depending upon the form of the monopoly these barriers can be

economic, technological, legal (e.g. copyrights, patents), violent

(competing businesses are shut down by force), or of some other type

of barrier that completely prevents other firms from entering the


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TYPES OF MONOPOLY

1. NATURAL MONOPOLY

If the supply of a commodity is localized in a single place, then the

monopoly is known as natural monopoly. Ex : Bangladesh possesses

the monopoly of Raw jute and India possesses the monopoly of

manganese.

2. LEGAL MONOPOLY

When a firm is given the legal right to produce a unique commodity ,

it is known as legal monopoly. Ex: The right of note issue has been

given by Law to the Reserve Bank of India only.


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PRIVATE MONOPOLY

It is owned and operated by private individuals or organizations for

the purpose of getting maximum profits. Such monopoly is

established by liquidating the competitors. A simple private

monopoly charges single price for his product from all theconsumers. While, on the other hand, a discriminating monopoly

charges more than one price for the same product from different

consumers.


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Legal Restrictions

Patents, licenses, and other legal restrictions(imposed by the government or some

governing body) provide some producers

legal protection from competition

Patents a way to protect inventors(innovators) from having their creations

stolen by other firms or people

Licenses when the government grants the

exclusive right to supply a particular good or

service


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Examples of monopoly

1.Private monopoly

2.government monopoly


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Examples of Privatemonopoly New Era Cap Company is the exclusive supplier of hats for Major League Baseball teams


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Reebok is the official supplier of NFL jerseys (go toreebok.com to get your official Vince Young jersey!)


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According to the Gillette website, the Gillette M3 Power razor is

protected by 62 patents


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Examples of govt. monopoly

1. Indian railway


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2. Mineral oils


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3. Automic energy and nuclear energy


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4. Electricity


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