Market Power:

In a competitive market there are infinite buyers and sellers. It  is considered to be an ideal  situation  where no one  is in a position  to influence prices  and all consumers and producers are assumed to act as price takers. But when there are only a few agents on one side  of the market, this assumption may not hold and agents may not act competitively.  These agents would possess marketpower,  i.e.,  ability  to influence prices. The examples  of market power are monopolies  and oligopolies. The presence of market power is a kind of market failure  that usually leads to lower production volume being sold at a higher price.  l'here is a welfare  loss  because an increase  in production is possible and is valued more highly by consumers than the additional cost incurred by producers.