2. Which scenario demonstrates a monopoly created by a single-owned resource?
Answer: C
A new rare jewel is found and only one mine in the world has it.
This scenario exemplifies a monopoly because the mine is the sole provider of the rare jewel, giving it exclusive control over the market for that resource.
A) A bridge is so infrequently used that it is rarely congested and therefore there is a large fixed cost of building the bridge but a negligible marginal cost of additional users.
This scenario does not represent a monopoly as the bridge can still be accessed by multiple users, and its usage does not hinge on a single owner controlling the resource. Instead, it describes a situation with high fixed costs but low marginal costs, which is characteristic of many public goods.
B) An author copyrights a new book.
While copyrighting a book gives the author exclusive rights to their work, it does not create a monopoly in the traditional economic sense of controlling a resource. Other authors can still produce their own works, and the existence of many books in the market does not constitute a monopoly situation.
C) A new rare jewel is found and only one mine in the world has it.
This option clearly illustrates a monopoly, as the single mine's control over the rare jewel means that no other entity can supply this resource. The exclusivity of the mine to that particular jewel ensures that it holds a monopoly position in the market.
D) An inventor creates and copyrights the code for a new piece of software.
Similar to option B, while the inventor may hold exclusive rights to the software through copyright, this does not create a monopoly in the market for software. Other inventors can create different software, and thus the market remains competitive rather than monopolized.
Conclusion
The scenario of the rare jewel and the mine best illustrates a monopoly because it involves exclusive control over a unique resource, preventing any competition. In contrast, the other options describe situations where multiple entities can exist or compete, thereby failing to demonstrate the essential characteristics of a monopoly.