Multiple choice

All of the following are characteristics of a monopoly except?

  1. There is a single firm

  2. The firm is a price taker

  3. The firm produces a unique product

  4. The existence of some advertising
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A monopoly is characterized by a single firm, unique product, and some advertising (to maintain market position). The key characteristic is that the monopolist is a price MAKER, not a price taker - they have market power to set prices. Being a price taker is the exception as it contradicts the fundamental nature of monopoly power.

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