Question

Are monopolies outside of those created through public franchises or patents guilty of monopolization? Does the FTC or the DOJ go after and break down every monopoly? Explain your answer in no more than 5 sentences.

Answer 1

A monopoly exists when there is a single firm in the market. Such a firm might cause damage to social welfare or deadweight loss tend to rise.

Patent and government awarded franchise cause the monopoly and such monopolies are considered legal and the government does not take any action against such firms.

Although monopoly can be created by the government, the monopoly through the other means might attract the actions from the government. The monopoly which is intended to compromise the competition comes under the severe scrutiny of the department of justice. Any such merger or combination that leads to monopoly tendencies in the market, are declared null and void.