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The Movie Theater Monopoly Debate
A company owns the only movie theater in a small, isolated town. A local consumer group files a complaint, arguing the theater is a monopoly and is charging unfairly high prices. The theater's owner argues they are not a monopoly because they compete with numerous other entertainment options available to residents. Analyze the validity of both arguments. In your analysis, explain how defining the 'market' in different ways is central to determining the extent of the theater's market power.
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