Explain the role that government regulation plays

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One aspect of a monopolist is the immense amount of pricing power that they have in the marketplace. Answer the following questions regarding the pricing power of a hypothetical monopolist:

1. At which point along the demand curve would a monopolist theoretically stop raising prices? Explain.

2. Compare and contrast the monopolist to the perfect competitor. Why is the perfect competitor a price-taker and the monopolist a price-maker? Explain.

3. Explain the role that government regulation plays in controlling the otherwise monopolistic tendencies of a real-world market for which there is largely only one supplier of a product or service.

Reference no: EM131574654

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