What characterizes a monopoly?

A monopoly is characterized by a single seller controlling the entire market. This type of market structure implies that the monopolistic firm is the sole provider of a product or service, which allows it to influence prices and output levels significantly. Since there are no close substitutes for the product being sold, the monopolist has considerable market power and can operate without the competitive pressures that typically exist in more fragmented markets.

In a monopoly, barriers to entry are usually high, preventing other firms from entering the market and competing with the monopolist. As a result, consumers have limited choices regarding the availability of alternatives, and the monopolist can dictate terms more freely than firms in competitive environments.