lectureOutline09 - Introduction to Economics Source: LR12,...

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ECO 100Y Introduction to Economics Topic 9: Monopoly Source: LR12, Ch 10, to pg 231; Ch 12, to pg 284; LR11, Ch 10, to pg 245; Ch 12, to pg 301 1 Topic 9: Monopoly ECO 100 W.G. Wolfson Topic 9: Monopoly Characteristics of a Monopoly Key Attributes: Only one supplier of a commodity No “close” substitutes Barrier(s) to entry of new firms Other Attributes: Many buyers Perfect information ECO 100 W.G. Wolfson 2 1 2
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Topic 9: Monopoly Barriers to Entry Barriers protect a firm from competition from new firms Legal Natural Legal barriers to entry: Patent / Copyright Government licence Franchise agreement Natural barriers to entry: Unique source of supply of a raw material Economies of scale (“natural monopoly”) ECO 100 W.G. Wolfson 3 Topic 9: Monopoly Revenue Functions in Monopoly A Monopolist faces the market Demand schedule D (market) = d (firm) D is negatively-sloped To sell more units, the Price must fall (on all units sold)
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This note was uploaded on 02/21/2009 for the course ECONOMICS ECO100 taught by Professor J.l.carr during the Spring '08 term at University of Toronto- Toronto.

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lectureOutline09 - Introduction to Economics Source: LR12,...

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