The world's second-largest manufacturer of widgets just went out of business. This caused the world's largest widget manufacturer, Widget Town, to be the last remaining widget producer. What is this situation called and how can Widget Town take advantage of it? (1 point)

Question

Widget Town now has no more competitors and can lead to lower prices.
Widget Town is now an oligopoly. It can raise its prices to earn a larger profit.
Widget Town is now a monopoly. It can raise its prices to earn a larger profit.
Widget Town is now an oligopoly. It could split into two firms that both create widgets, which would increase competition and benefit the consumer.

Answer 1

Widget Town is now a monopoly. It can raise its prices to earn a larger profit.