1. Identify 3 businesses, corporations etc. which you feel most closely fit the definition of a monopoly. Be sure to include the 2 criteria that must be present to have a monopoly.
2. If you had your choice, would you rather sell a product over which you had a monopoly or a product that was close to perfectly competitive? Explain your answer posing the different questions you'd have to ask about the monopoly and product you are selling.
3. When an entrepreneur creates a new, highly demanded product, he/she often takes out a patent on the product. This makes it illegal for anyone else to manufacture the exact same product for 20 years, essentially creating a monopoly for that product. Explain in detail why you think this is either fair or unfair.
4. The special licensing for taxi drivers in San Diego has been effectively eliminated. Do you feel that this license gave the taxi industry (as a whole) in San Diego a monopoly? Explain.
5. Referring to the above example, Uber has now entered the transportation industry without requiring special licensing that used to apply to taxi drivers. How has the entry of Uber affected the market for transportation (think of cost, convenience, safety, punctuality etc.)?
6. As detailed in the lecture, monopolies like perfectly competitive firms maximize their profits where marginal revenue (MR) is equal to marginal cost (MC). The difference however is that the monopolist produces less goods for society (economically inefficient) at higher prices to the consumer. Explain in detail why you feel that this is or is not an unfair waste of resources as well as an unfair pricing strategy for the consumer.
7. Standing in a ticket line to see a movie you and your date witness an elderly couple show their ID's to qualify for a discounted ticket because of their age. They pay $8 each while you pay $14 for both you and your date. Price discrimination like this occurs in various forms in almost all industries. Do you feel that this is fair? Explain your reasoning in detail.