If you were to compare perfect competition to monopoly, say, on a line measuring "no competition" on one side to "considerable competition" on the other, then monopoly would be at one end and perfect competition would be at the other end. The two market structures are almost polar opposites.
First, let's consider some characteristics of the monopoly model.
Characteristics of Monopoly
1. one firm (one seller)
2. produces a unique product for which no close substitute exists
3. extremely high barriers to entry
4. downward-sloping demand curve (price-maker)
Charcteristic #3 (extremely high barriers) deserves a further comment. More to follow.
