Which of the following is a characteristic of a monopoly?

• A. There are no barriers to entry.
• B. Firms in the market are price takers.
• C. Products are perfectly substitutable.
• D. There is only one seller in the market.

Answer: (D)

Verified step by step guidance

1. Understand the definition of a monopoly: A monopoly is a market structure where there is only one seller or producer that controls the entire supply of a product or service.
2. Identify key characteristics of a monopoly, such as: a single seller, unique product with no close substitutes, and high barriers to entry preventing other firms from entering the market.
3. Analyze each option given in the problem: 'No barriers to entry' contradicts the monopoly characteristic because monopolies typically have high barriers to entry.
4. Recognize that 'Firms in the market are price takers' applies to perfectly competitive markets, not monopolies, where the single firm is a price maker.
5. Note that 'Products are perfectly substitutable' describes perfect competition, whereas monopolies offer unique products without close substitutes, confirming that the defining characteristic is 'There is only one seller in the market.'