Economics question Considering your previous knowledge of monopolies and the nature of competition; how do monopolies hinder competition and why is it important for governments to take steps to limit this business practice? Please provide at least two examples. (6pts)

Textbook pages: (151–154)

Monopolies hinder competition because by definition, they are anti-competitive.

Explanation:

A monopoly is a firm that is the sole provider of a good for which there are no close substitutes.

Monopolies charge higher prices than they would in a competitive enviroment, and for this reason, they benefit the monopoly at the expense of the consumers.

Governments can set several policies to reduce monopoly power. One policy is simply to prohibit monopolies from forming, which is the case for most industries in developed nations.

Another policy is to simply take over the monopoly, and make it a public enterprise, so that the extra economic benefits of the monopoly are shared with the people (at least in theory).

soviet influence spread across eastern europe sharply during and after wwii. the soviet armies liberated the countries in eastern europe and occupied them from the germans as they were forced to retreat towards germany.