The concept of a monopoly

A monopoly involves artificial restriction of production by an entity having sufficient market power to do so. Economists argue that a monopoly is able to exploit the demand for a product to increase their profits at a cost to society and consumers.áááFor example, a company with a monopoly can manipulate supply of a product or service. A reduction in the level of production, which is one way to achieve higher profits, is known as "contrived scarcity."á Contrived scarcity creates inefficiency in an economy and to promote economic efficiency, various laws were passed that limit the market power of monopolies.

Monopolies are unique since the marketplace contains only one firm supplying products and services. In this situation, the company has more leverage or power to set prices than firms in more competitive industries. A monopoly can be thought of as the opposite of a perfectly competitive marketplace. Instead

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antage over the competition. An example of a near-monopoly is Microsoft Corporation. The existence of a monopoly is not in and of itself unlawful. However, the abuse of market power to the harm of consumers or other firms is illegal. In the Microsoft case, various state, federal and international entities have alleged that Microsoft had abused its near-monopoly power to manipulate the market for operating systems. Microsoft Corporation has always maintained that the integration of its web browser into its operating system brought technological advantages that were to the benefit of consumers, and that the companyÆs actions were never intended to harm consumers or competition. According to Elizabeth Corcoran (2004), try as it might, Microsoft just cannot seem to stay out of the courthouse. Corcoran ads that the company has been in a decade long antitrust odyssey despite the fact that Microsoft has been working steadily to settle all the cases against it. Briefly, MicrosoftÆs defense is based on this premise: Microsoft did nothing to cause consumers to pay more for the operating systems it sells worldwide (Corcoran, 2004), If economies of scale exist throughout the relevant range of output, large firms can produce at a low
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Some common words found in the essay are:
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Approximate Word count = 2652
Approximate Pages = 11 (250 words per page)

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