Price Maker


DEFINITION of 'Price Maker'

A monopoly or a firm within monopolistic competition that has the power to influence the price it charges as the good it produces does not have perfect substitutes.


A monopoly is a price maker as it holds a large amount of power over the price it charges.

A price maker that is a firm within monopolistic competition produces goods that are differentiated in some way from its competitors' products. This kind of price maker is also a profit-maximizer as it will increase output only as long as its marginal revenue is greater than its marginal cost, in other words, as long as it's producing a profit.

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  2. Price-Taker

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  3. Monopolistic Competition

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  4. Monopsony

    A market similar to a monopoly except that a large buyer not ...
  5. Monopoly

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  6. Bilateral Monopoly

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  1. What are the characteristics of a monopolistic market?

    A monopolistic market is a market structure that has the characteristics of a pure monopoly. A monopoly exists when there ... Read Full Answer >>
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    In economics, utility function is an important concept that measures preferences over a set of goods and services. Utility ... Read Full Answer >>
  3. What does marginal utility tell us about consumer choice?

    In microeconomics, utility represents a way to relate the amount of goods consumed to the amount of happiness or satisfaction ... Read Full Answer >>
  4. What is the difference between JIT (just in time) and CMI (customer managed inventory)?

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