Monopoly A

Part A: Is your college bookstore a monopoly?

Is there only one store on your college campus allowed to sell textbooks? Are there economic costs to this monopoly power? Are there economic benefits to this monopoly power? Assess the market for textbooks on your campus using the following key concepts from Chapter 10.

Costs or benefits of monopoly

Monopoly price

Restricted output

Monopoly profits

Barriers to entry

Research and development

Economies of scale

Natural monopoly

Entrepreneurial incentives

Contestable markets

From the list above, which item is the strongest argument against your school allowing monopoly power in the textbook market? Why?

From the list above, which item is the strongest argument in favor of your school allowing monopoly power in the textbook market? Why?