High Quality Content by WIKIPEDIA articles! In economics, a firm is a monopoly when, because of the lack of any viable competition, it is able to become the sole producer of the industry's product. In a normal competitive situation, the price the firm gets for its product is exactly the same as the Marginal cost of producing the product. Because the monopoly firm does not have to worry about losing customers to competitors, it can set a price that is significantly higher the Marginal (Economic) cost of producing (the last unit of) the product. Therefore, a monopoly Situation usually allows the firm to set a monopoly price which is higher than the price that would be found in a more competitive industry., and to generate an economic profit over and above the normal profit that is typically found in a perfectly competitive industry. The economic profit obtained by a monopoly firm is referred to as monopoly profit. The existence of a monopoly, and therefore the existence of a monopoly...

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