Q2 i need answer plzz?

Question

how product pricing of a monopoly different from that of a perfect competitive firm ? can a monopoly firm fix any price for it's product

Answer 1

In a perfectly competitive market, prices are established by supply and demand at an equilibrium point. a monopoly can set almost any price because it is the only supplier of a product or service which is in demand. That is why monopolies are typically regulated: to prevent exorbitant pricing. However, even a monopoly can price itself out of the market. If you are the only electric company and you price your service so high that money people simply cannot pay, they may use substitute power such as heating with wood, and lighting with candles.