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Since a monopoly is the only firm supplying a particular product, its demand curve is the same as the demand curve
for the entire industry. Similar to other market structures, the profit maximization
of a firm can be determined where Marginal Revenue (MR) is equal to Marginal Cost (MC).
Profit Maximization:
MR=MC
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Therefore, Profit Maximization Occurs when
All market structures have certain characteristics that when identified
help better classify what type of market a firm falls under. In comparison to
other types of markets, a Monopoly has only one firm, many barriers of entry, an extremely high level of market power, and
it is the only firm that is putting out the market supply of its particular product.
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