Why do monopolies occur?

Answer 1

Monopolies occur when a company or person(s) want to take over the market. By becoming the sole supplier of a comodity, the monopily can raise prices and gain more profit. A monopoly creates an oppressive market and is to be avoided if a healthy economy is to thrive on what is termed, "A level playing field."

More explanation is required.

Monopolies have three main sources in most economies. They are:

1. A key resource is owned by a single company;

2. The government gives a single firm the exclusive right to produce some good or service; and

3. The costs of production makes a single producer more efficient than a large number of producers.