Monaco is both a city and an independent nation, which means Monaco is also the capital city. Sometimes mistaken for the capital, Monte Carlo is the most populated region in Monaco.
France borders the country of Monaco on three sides while the other side borders the Mediterranean Sea. France has a large influence on Monaco as evidenced by the Franco-Monegasque Treaty (1918), which provides for limited French protection over Monaco. The treaty, endorsed in 1919 by the Treaty of Versailles, established that Monegasque international policy would be aligned with French political, military, and economic interests. More recently in 2002, a new treaty between France and Monaco specified that, should there be no heirs to carry on the Grimaldi dynasty, the principality would still remain an independent nation rather than revert to France. Monaco’s military defence, however, is still the responsibility of France.
People from Monaco are known as either Monégasque or Monacan
French is the official language of Monaco, but English, Italian, and Monegasque are also spoken. Monegasque evolved from the Italian dialect of Liguria, the Italian region closest to Monaco. Monegasque is influenced by French as well as two other dialects.
Monaco has an area of 2.02 km2 (0.78 sq mi); it is the second smallest and the most densely populated country in the world. Monaco has a land border of 4.4 km (2.7 mi), a coastline of 4.1 km (2.5 mi), and a width that varies between 1,700 and 349 m (1,859 and 382 yd).
The easy answer because it is ruled by a prince.