| A | B |
|---|
| pure monopoly | a market structure in which one firm sells a unique product, into which entry is locked, in which the single firm has considerable control over product price, and in which nonprice competition may or may not be found |
| 5 characteristics of a pure monopoly | 1.single seller 2.no close substitutes 3.price makers 4.blocked entry 5. nonprice competition |
| barriers to entry | anything that artificially prevents the entry of firms into an industry |
| network effects | increases in the value of a product to each user, including exisiting users, as the total number of users rises |
| x-inefficiency | the failure to produce any specific output at the lowest average (and total) cost possible |
| rent-seeking behavior | the actions by persons, firms, or unions to gain special benefits from government at the taxpayers' or someone else's expense |
| price discrimination | the selling of a product to different buyers at different prices when the price differences are not justified by differences in cost |
| socially optimal price | the price of a product that results in the most efficient allcoation of an economy's resources and that is equal to the marginal cost of the product |
| fair-return price | the price of a product that enables its producer to obtain a normal profit and that is equal to the average total cost of producing it |
