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The disadvantages are that in the long run, all costs are variable and each competitor makes zero profit. In this scenario, supply and demand are only limited by the question," Given the demand curve, how much should I supply?" (Collander, 2001).
In this case, demand is elastic.
In a monopoly, the barriers are great to entry and the monopolist is the price setter...
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The advantages are that for the monopolist, there is no competition and prices can be set to maximize profits. For those who would want to enter, the barriers to entry may be too great. There is no competition and product could suffer. The consumer has no choice other than to purchase the good or service or not to purchase...
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