Tag: monopoly
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Disadvantages of monopoly
Disadvantages of monopoly Inefficiency in production Does not cater to the demands of consumers May exploit the consumers as it is the only business providing the product May charge higher price by decreasing the supply
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Advantages of monopoly
Advantages of monopoly Lower costs Save money, by not producing wasteful duplication Spend money on research Offer lower price to the consumer
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Pricing under perfect competition
Pricing and output policies in perfect competition Large number of buyers and sellers The firms charge the same price as the competition does, they do not increase or decrease price They seek to achieve competitive advantage Firms respond quickly to the changes in consumer demands
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Principle of Profit maximization
Principle of profit maximization Firms strive to achieve maximum profits. They do this by keeping the difference between total revenue and total cost highest and in a positive figure