Most industries have the characteristics of monopolistic competition or oligopoly, a market type in which a few large companies dominate and therefore have greater power to control prices and market conditions. In the real world monopolies are rare, and perfect competition is probably nonexistent.

Perfect competition describes a market composed of numerous sellers all offering an identical product, so that none of the sellers has the ability to control prices. A monopoly exists when a single company is the only seller of a good or service and therefore has the power to raise prices, cut production, or otherwise shape the market for its own benefit. Monopolistic competition combines the features of two opposing theoretical concepts: monopoly and perfect competition. businesses subject to conditions of monopolistic competition are clothing stores, restaurants, wine merchants, convenience stores, and other retailers in large cities. Each firm has some amount of control over prices and market conditions even though there is a high level of competition among them. Monopolistic competition describes a market structure (a market is any place or system in which buyers and sellers of products come together) composed of numerous relatively small businesses, each of which sells similar but not identical products.

Real world monopoly examples