In? Austin, Texas, there are three very popular? drugstores: CVS,? Walgreens, an
ID: 1162169 • Letter: I
Question
In? Austin, Texas, there are three very popular? drugstores: CVS,? Walgreens, and? Stride-Way. While Walgreens remains open twentyminusfour hours a? day; CVS and? Stride-Way close at 9 pm. which of the following statements is? true??? A. Walgreens is a monopoly all day because it produces a service that has no close substitutes.?? B. Walgreens probably has a higher markup to compensate for its higher cost of production. C. Walgreens has a monopoly at midnight but not during the day. D. Walgreens can ignore the pricing decisions of the other two supermarkets.
Explanation / Answer
CVS, Walgreens, and Stride-Way are three drug stores in Austin.
Walgreens: Remains open 24*7
CVS: Closes 9:00 PM
Stride-way : Closes 9:00 PM
Monopoly is defined to be the market condition where we have one and only one seller of a particular good or a commodity for which there are no close substitutes.
GIven information clearly tells us one thing, up to 9:00 PM.
After 9:00 PM, there is a single firm Walgreens, which remains open, is a single seller for the drugs for which there are no substitutes from other sellers.
Thus, Walgreens has a monopoly at midnights but not during the day.