Question 1 Answer

a) Market structure refers to the environment in which firms operate and how the market forces interact with each other.

b) Monopoly has many buyers and one seller.

Unique goods are sold by the monopoly where there are limited or no substitutes.

There are a number of barriers to entry making it difficult for other firms to enter the industry; the monopoly firm is the only one in the industry.

The firm has a great deal of control over price and usually raises it very high to maximise profit.

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