Question

A market which has only one buyer is known as

• A. Monopoly market
• B. Monopsony market
• C. Oligopoly market
• D. Oligopsomy market

Hint:

Market Structures by Numbers:
Single Seller = MONOPOLY.
Single Buyer = MONOPSONY.
Few Sellers = OLIGOPOLY.
Few Buyers = OLIGOPSONY.

Answer 1

The Correct Option is B

Step 1: Understanding the Concept:
Microeconomic market structures and imperfect competition: a market structure dominated by a single sole buyer facing multiple competing sellers is defined as a monopsony.
Key Formula or Approach:
\[ \text{Market Structures: Single Seller } = \text{Monopoly} \quad \longleftrightarrow \quad \mathbf{Single \text{ } Buyer = Monopsony} \]

Step 2: Detailed Explanation:
Classifications of market structures in economics:
1. Monopsony Market (B): A market structure characterized by only one single buyer (monopsonist) who purchases goods or services from multiple competing sellers or suppliers, exerting strong downward pricing power (buyer power) (e.g., a single seafood processing plant being the sole purchaser of shrimp harvests in an isolated coastal landing center).
2. Monopoly Market: Market with only one seller and many buyers.
3. Oligopoly Market: Market with a few sellers.
4. Oligopsony Market: Market with a few buyers.

Step 3: Final Answer:
Therefore, a market with only one buyer is a Monopsony market, corresponding to option (B).