Question

While pure monopolies are rare, there are many instances of market power. Think of an example...

While pure monopolies are rare, there are many instances of market power. Think of an example of a business, product, or service that acts as if it were a monopoly.

What is the source of its market power?  

Are consumers being hurt by the lack of competition?

If so, how?


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Answer #1

Answer - The Apple Inc is a monopoly . It keeps the whole of the market power in the market of iphones. This market power has been created with the software used i.e IOS which cannot be used by any other company. The gadgets are one and only of their kind with high standards of security and features that are unmatchable. This gives this company the monopoly power due to which the prices of its gadgets are sky rocketing. But , most of the consumers find it a sign of prestige to hold the Apple gadgets due to which the products are in high demand even if the prices are so high. Hence it seems that the prices do not hurt , rather they have became a status symbol.

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