Question

Provide a current day example of a near-monopoly and describe how their lack of competition, affects the prices they charge and the service they provide.

Answer 1

Let's take an example of Pfizer multinational drug company in the US. The US law provide for the a patent for the newly invented drugs in the market. Pfizer has a patent for its drug Enbrel that is an anti inflammatory drug.

having a patent provides the company a monopoly over the product is sells. having a monopoly allows the firm to change a higher price than they would normally charge and they suppl a lower quantity of drug in the market as compared to a perfect market where there are many sellers of the goods. If there was a fair competition they will charge a lower price and higher quantity of goods in the market. people will have more substitutes in the market.