In the American Economy, business is controlled by the government and the consumer. When a person is the owner of a business that is alone in its product that it provides for the consumer, it is said to be a monopoly. As a monopoly you have sole control over price. Monopolies are regulated by the government in order to prevent the misuse of power that a monopoly has. If a person can only get turkey, for example from one store.
Then the store can charge a lot more for that turkey than it could if the store next door was selling it too because then there would be competition. Also, the store would not have to produce a better quality of turkey because there would be no reason for it to do so. In this situation the consumer is taken unfair advantage of by the business owner, in this case the store. Government regulates monopolies to promote a perfect competition economy and to get rid of the “turkey situation” discussed above. The benefits of a perfect competition economy benefit consumers.
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For example, if we go back to the store, in a perfect competition economy all of the stores have turkey. Now the stores want to make sure that the turkey that they sell is the best turkey and cost the least. In this situation they are competing for the consumer’s business. However, business owners of a monopoly situation disagree with the government. When there is a business that has the potential to become a monopoly the government watches it very closely and the business has to go through the government for mergers and such. The more the business becomes a monopoly, the more the government says no to the business’s requests.
For example, there is Microsoft. The government has been working to keep Microsoft from being the big business that it is today. So, in conclusion, a perfect competition economy makes benefits for the consumer. Likewise, a monopolistic economy makes benefits for the business owner. On the flip side, a perfect competition shows drawbacks for the business owner and a monopolistic economy shows drawbacks for the consumer. The best way to run an economy is to have a balance between the two options.
America’s economy does this.