(i) Single Producer : In this type of market , there is only one producer of the commodity, therefore that producer is supplying 100 % of that commodity, means he is controlling the entire supply of the market. Therefore that firm can effect the Price and Supply of the Market .
(ii) No close substitute available in the market : In monopoly market, we can not see any close substitute of the commodity. Substitutes are possible but close substitutes are not possible. For example Railways. Govt. of India has monopoly in running the trains in India. There are other means of transportations available in the market. They are substitute to it but not close substitute. Therefore cross elasticity of demand is zero.
(iii) Selling Cost exist but less important :In monopoly market selling cost exist and included in cost of production. Advertisements are given to introduce the commodity in the market and to recall the memory of the consumers. But the expenses made by the firm on the selling techniques is very less because there is no other close competitor of the existing firm in the market.
(iv) Restrictions in Entrance and Exit of Firms : In monopoly market there is physical, legal, social, political or other type of restriction due to which new firm cannot enter in the market. These restrictions are applied in order to maintain the monopoly in the market.
