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精编密训教材，分阶快递。Herfindahl Index: the sum of the squares of the market shares of firms in a particular market or industry, to measure the concentrated power generated by shares of the market.
●The Nature Of Monopoly and its types
Monopoly is a single firm sells a product for which there are no close substitutes. Thus the firm is the industry – the other end on the spectrum.
The demand curve of the monopoly is downward sloping to the right implying that P>MR and a pricing strategy ensues.
The output of monopoly is the intersection of MR=MC.
The price of monopoly is the corresponding price on the Demand curve of the output on the intersection – profits are maximized.
●The Dead Weight Loss
Dead weight loss is represented in the graph – the purple area, which accrue to the profits of no one. Dead weight loss is due to inefficiency of monopoly.
●Price Discrimination
The firm doesn’t always charge the highest price th
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