Companies
Is Microsoft a monopoly?
True or False
True! Microsoft dominates PC operating systems, with a market share of 70%
This 1890 law was the first federal act to prohibit monopolistic business practices.
The Sherman Antitrust Act.
Monopolies may restrict this to keep prices high, even if they could produce more.
Output/Supply.
This group often pays more and has fewer choices when a monopoly controls a market.
Consumers.
This strategy involves a monopoly reducing the price of its product temporarily to drive competitors out of the market.
Predatory pricing.
Is Apple a monopoly?
True or False
False! Apple only has a market share of 17%
This government agency is responsible for enforcing antitrust laws and preventing anti-competitive business practices.
Federal Trade Commission.
Monopolies can harm this group in particular by limiting access to affordable goods or services.
Low-income consumers.
Monopolies can charge higher prices because they lack this basic market feature.
Competition.
Monopolies can increase their market power by acquiring or merging with other firms in the same industry, which is known as this.
Horizontal integration.
Is USPS a monopoly?
True or False
True! USPS holds a monopoly over other postal services.
This type of monopoly occurs when a single firm can supply a good or service more efficiently than multiple firms due to high fixed costs.
Natural monopoly.
Monopolies can lead to this long-term negative economic effect by discouraging new firms from entering the market.
Market stagnation.
This is the primary barrier that allows a monopoly to maintain control over a market.
Barrier to entry.
This is the term for when a monopoly expands into different stages of production or distribution to control more of the supply chain.
Vertical integration.
Is Walmart a monopoly?
True or False
False! Walmart does not hold a monopoly over the retail market as they only have 9% market share.
This term describes government action to prevent companies from becoming too powerful or unfair in the marketplace.
Regulation.
Because monopolies have less incentive to innovate or improve, they may suffer from this type of inefficiency.
Productive inefficiency.
A monopoly occurs when this happens in a market, preventing other firms from competing.
Single firm controlling entire market.
A monopoly may use this to influence consumer perception and maintain its dominant position in the market.
Advertising.
Is Amazon a monopoly?
True or False
This type of monopoly refers to a market in which a single seller dominates, often due to high barriers to entry.
Pure monopoly.
This term refers to the loss of total surplus (consumer and producer) due to monopolistic pricing.
Deadweight loss.
The government may intervene in monopolistic markets through these laws, which are designed to promote competition.
Antitrust laws.
Monopolies with significant market power may use this tactic to secure exclusive agreements with suppliers or retailers, limiting competitors' access.
Exclusive contracting.