There are many firms in monopolistic competition and only one in monopoly.

The monopolist may make a profit in the long run whereas the monopolistic competitor will not

Price discrimination is less common with monopolists than with monopolistic competitors

A monopolist would never react to the imposition of a tax on its product by reducing its price, but a monopolistic competitor might

Firms in these industries may attempt to cooperate.

Firms in these industries are interdependent.

The fact that there is more than one firm in an oligopoly means that there are no barriers to entry.

An oligopoly with two firms is called a duopoly

Each firm makes an assumption about how much the other will produce, and sets its own output at the level which will maximize its profit if the other firm behaves as assumed

Each firm has a reaction curve showing its chosen output for different outputs that the other might set

The equilibrium is where the reaction curves intersect

If the duopolists produce homogeneous products, then the equilibrium price will be the same as if the industry had a monopoly

The model assumes one firm is a price leader

Each firm makes an assumption about the price that the other will set, and sets its own price at the level which will maximize its profit if the other firm behaves as assumed

Each firm has a reaction curve showings its chosen price for different prices that the other might set

If the duopolists produce homogeneous products, then the equilibrium price will be the same as would arise if the industry was in perfect competition

Why an oligopolist’s price is what it is

Why an oligopolist might find that its sales fell greatly if it raised its price

Why an oligopolist might find that its sales increased little if it cut its price

Why an oligopolist might not change its price, even if the prices of variable inputs changed