Answer to Question #203969 in Microeconomics for Katlego

Question

Analyse Eskom in terms of the characteristics of a monopoly

Answer 1

A monopoly firm has no close substitute for its goods and services since it’s a single firm which sells output into the market and has unique product restrictions of entry and exit of firms into the industry.Eskom is a South African Utility power Supply firm that distributes electricity to the people of South Africa.In reference to characteristics of monopoly, when an individual wants electricity in their home they cannot go to any other supplier, so they have to contact Eskom or totally do without it.Therefore, Eskom is the sole supplier of electricity and has notable power stations including Koebarg the only nuclear power station in Africa and it’s located in Cape province