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Question
Microeconomics
Posted 7 months ago
Which of the following describes a monopoly market?
Choose 1 answer:
A) Pathos, Inc., which produces an antibiotic that is similar to its rival Logos Corp.
(B) Reason, Inc., which is one of the many sellers of a resource with only one buyer.
(c) Kairos, LLC, which is one of many producers of an identical drug with an expired patent.
(D) Ethos Unlimited, which is the sole producer of Gleemenex, a drug with no close substitutes.
(E) Rhetorica Unlimited, which is one of many sellers selling a good that is slightly differentiated from other sellers.
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Answer from Sia
Posted 7 months ago
Solution
a
Monopoly Definition: A monopoly market is characterized by a single seller that produces a unique product with no close substitutes
b
Option Analysis:
- Option A: Pathos, Inc. has a rival, indicating competition.
- Option B: Reason, Inc. is in a market with many sellers and one buyer, which describes a monopsony, not a monopoly.
- Option C: Kairos, LLC is one of many producers, indicating perfect competition.
- Option D: Ethos Unlimited is the sole producer of Gleemex, a drug with no close substitutes, fitting the monopoly definition.
- Option E: Rhetorica Unlimited is in a market with many sellers and slightly differentiated products, indicating monopolistic competition
Answer
D. Ethos Unlimited, which is the sole producer of Gleemex, a drug with no close substitutes.
Key Concept
Monopoly Market
Explanation
A monopoly market is defined by a single seller with a unique product and no close substitutes, which is best described by Ethos Unlimited in option D.
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