Question

Market situation where there is only one buyer is

• A. Monopoly
• B. Monopsony
• C. Duopoly
• D. None of these

Hint:

Remember the roots: "Mono" = one. "Poly" = seller. "Psony" = buyer. So, Monopoly = one seller, Monopsony = one buyer.

Answer 1

The Correct Option is B

Let's define the market structures:

Monopoly: A market with a single seller.
Monopsony: A market with a single buyer.
Duopoly: A market with two sellers.
Therefore, a situation with only one buyer is called a monopsony. A classic example is a company town where a single factory is the sole employer (buyer of labor).