One company dominates because competitors cant afford to enter the industry. Microsoft was ultimately forced to stop its exclusionary practices. An industry is classified as natural monopoly when a single large firm can produce for the entire market at a lower average total cost than two or more. A natural monopoly is a legal monopoly that occurs because of high start-up costs or economies of scale. ( IBM) computers and its ability to exclude other software developers by preventing their products from being installed on computers with Microsoft's operating system. ( MSFT) to have a monopoly in the software industry because of its dominance of operating systems software used in International Business Machines Corp. Updated: Definition and Characteristics of Pure Competition Pure competition is a term that describes a market that has a broad range of competitors who are selling the same. ( T) operated as a legal monopoly in the telephone industry for many decades until 1982 when it was forced to break up into eight smaller companies, almost all of which have since become a part of AT&T again. Court of Appeals eventually deemed it in violation of the Sherman Antitrust Act and forced the company to dissolve. in 1890 and, through acquisitions and mergers, came to control virtually the entire American tobacco industry with around 150 factories. Washington Duke and his sons founded the American Tobacco Co. Even if they can enter the industry, competitors may not have consistent access to the resources they need to provide the products or services at a competitive price. One company dominates because competitors can't afford to enter the industry. (ticker: X), which remains among the largest steel producers in the world. A natural monopoly is a legal monopoly that occurs because of high start-up costs or economies of scale. dominated the steel industry of the late 19th century and became part of the world's first billion-dollar business when it merged with a group of other steel businesses under the name U.S. by eliminating or merging with competitors until 1911, when the Supreme Court determined the company violated the Sherman Antitrust Act, forcing Standard Oil to split into 34 independent companies. and Trust took control of up to 95% of oil production, processing, transportation and marketing in the U.S.
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