Question

What is a monopoly? Why may it be harmful to a free-market economy?

Answer 1

Answer: Monopoly is a situation where there is a single seller in the market. In conventional economic analysis, the monopoly case is taken as the polar opposite of perfect competition. Thus, the monopolist has significant power over the price it charges, i.e. is a price setter rather than a price taker.(from goolge)

Explanation: It can be harmful to a free-maket beacaue it could cause u to loss money or stoten money

Answer 2

The advantage of monopolies is the assurance of a consistent supply of a commodity that is too expensive to provide in a competitive market. The disadvantages of monopolies include price-fixing, low-quality products, lack of incentive for innovation, and cost-push inflation.