Final answer:
A monopoly is a single firm that dominates sales in a specific market, with no close substitutes for its product, such as Microsoft with its operating systems. The market refers to the arena of goods and services exchange. An oligopoly, on the other hand, involves a few firms dominating market sales and influencing each other.
Step-by-step explanation:
A monopoly is a market structure characterized by a single firm that has the bulk of sales in a specific market. This firm sells a product for which there are no close substitutes, allowing it to have significant control over pricing and market conditions. One classic example of a monopoly is Microsoft, especially when looking at its dominance in the operating systems market.
It's important to understand what defines a "market" in this context. A market is the environment in which goods and services are offered for sale by firms and purchased by consumers. The term 'market' can refer to different scopes, such as local, national, or international markets, as well as to different ranges of products.
In contrast to a monopoly, an oligopoly occurs when a few firms control most or all of the sales in a market. These firms have significant market power but are also influenced by each other's actions, as opposed to a monopolistic market where one firm has predominant influence.