What is the primary feature of a monopoly?

A monopoly is characterized by the presence of only one company in the marketplace that provides a particular good or service, which allows that company to dominate the market without any direct competition. This single firm typically controls the entire supply of a product or service, giving it significant power over pricing and availability. This situation often leads to higher prices and reduced choices for consumers since there are no alternative providers to turn to for similar goods or services.

The distinction between a monopoly and other market structures is crucial. For instance, when multiple companies produce identical goods, it represents perfect competition, where no single entity can influence the market price significantly. In contrast, a monopoly's unique position allows it to operate independently of market forces that would otherwise apply in a more competitive environment.

In cases where there are few companies with differentiated products, such as in an oligopoly, these companies still compete with one another, which can lead to varied pricing and product offerings within the market. Similarly, having only one buyer for specific services characterizes a monopsony rather than a monopoly, highlighting the importance of understanding these different economic terms. Thus, the defining feature of a monopoly lies in the existence of a singular seller dominating the market landscape.