Microeconomics: Monopoly Market Structure and Discriminating Monopoly

Running head: MICROECONOMICS
Microeconomics
Name of the Student
Name of the University
Author Note

1MICROECONOMICS
Table of Contents
Answer 1..........................................................................................................................................2
Answer 2..........................................................................................................................................3
References........................................................................................................................................7

2MICROECONOMICS
Answer 1
The monopolistic market structure is characterized by a single seller and many buyers,
with the seller enjoying absolute market power as the product sold by the seller has no close
substitutes. The entry and exit of the market is highly restricted.
The average revenue in any market is defined as the total revenue earned by the firms by
the units of commodities sold. Thus, the average revenue curve can also be defined as the curve
showing the revenue per unit of the firms. In case of a monopoly firm, the average revenue curve
is a downward sloping curve, which decreases with the increase in the units of the commodities
(Rader 2014). This can be shown with the help of the following figure:
Figure 1: Average Revenue Curve in Monopoly Market