| Chapter 4 Outline |
| I. GENERAL COMMENTS AND DEFINITIONS |
| A. Market Power |
| 1. Firms have market power when the following conditions exist. |
| a. Firms can influence price in attempts to increase profits. |
| b. The existence of profits does not attract new firms into the industry. |
| B. Monopoly |
| 1. A monopoly is a single seller of a product with no dose substitutes. |
| C. Oligopoly |
| 1. An oligopoly is a market with a few producers or sellers of a good. |
| D. Cartel |
| 1. A cartel is an organized group of firms who manage output and pricing as if they were a monopoly. |