Which market structure is characterized by a single seller, high barriers to entry, and no competition?

Which market structure is characterized by a single seller, high barriers to entry, and no competition?

• A. Monopoly
• B. Pure (Perfect) Competition
• C. Monopolistic Competition
• D. Oligopoly

Answer: (A)

Monopoly. The key idea is that one firm dominates the entire market, facing little to no competition. High barriers to entry prevent others from entering, so the sole seller can influence price and output without rival firms eroding their position. In this setup there aren’t close substitutes available, and new entrants can’t easily challenge the dominant firm. By contrast, markets with many sellers (pure/perfect competition or monopolistic competition) or a few large firms (oligopoly) still have some competition or interdependence among firms, not a single seller.

Monopoly. The key idea is that one firm dominates the entire market, facing little to no competition. High barriers to entry prevent others from entering, so the sole seller can influence price and output without rival firms eroding their position. In this setup there aren’t close substitutes available, and new entrants can’t easily challenge the dominant firm. By contrast, markets with many sellers (pure/perfect competition or monopolistic competition) or a few large firms (oligopoly) still have some competition or interdependence among firms, not a single seller.