Which market structure has a single seller with a unique product and high barriers to entry?

• A. Monopoly
• B. Perfect competition
• C. Oligopoly
• D. Monopolistic competition

Answer: (A)

Monopoly is a market structure where a single firm controls the entire market. The product is unique with no close substitutes, giving the firm substantial power to set prices. High barriers to entry—such as exclusive control of a key resource, legal protections, or economies of scale—prevent new competitors from entering. Because of this, the firm faces a downward-sloping demand curve and will produce where marginal revenue equals marginal cost, charging a price above marginal cost. This combination of one seller, a unique product, and high barriers to entry distinguishes the monopoly from other structures like perfect competition (many sellers, identical products, easy entry), monopolistic competition (many sellers, differentiated products, relatively low barriers), and oligopoly (a few firms with strategic interactions).