What can be expected from a market structure characterized by a monopoly?

In a market structure characterized by a monopoly, one seller indeed controls the entire supply of a product or service. This structure arises when a single company becomes the sole provider of a product that has no close substitutes, allowing it significant pricing power and the ability to influence overall market conditions.

Monopolies can result in economies of scale, where a single firm can produce goods at a lower cost per unit due to large volume production. This dominance can enable the monopolist to achieve profits that are higher than those typically seen in more competitive markets. Additionally, since the monopolist is the only seller, it does not face direct competition which means it can maintain control over pricing strategies, often leading to higher prices and reduced output compared to more competitive industries.

The other options present different market structures: multiple competitors indicate perfect competition or monopolistic competition, while frequent price fluctuations hint at markets with greater competition and supply-demand interactions. Lastly, equality in market share distribution suggests an oligopoly or competitive market, contrasting sharply with a monopolistic environment where one firm holds all the market power.