Week 5: Monopoly and Imperfect Competition – Part A Text References Ch.10 Monopoly & its Regulation pp. 221 – 244 Ch.15 Monopolistic Competition pp. 339 – 356 Ch.16 Oligopoly games and Strategies pp. 357 – 380 1 2 3 Market Structure Perfect Competition Monopolistic Competition Oligopoly Duopoly Cartel Monopoly 10 Market Structure Perfect Competition Sell Side • • Perfect Competition • Duopoly • Monopoly • Example One large seller controls
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a high concentration ratio, this means that these firms are controlling the market by holding a big percentage of the market share. With only a few firms holding large amounts of shares, the industry becomes less competitive and becomes more of a monopoly. On the other hand, with a low concentration ratio, we are likely to see more of a competitive landscape. This shows that the industry is filled with many
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Five Forces Analysis Introduction (1) • Devised by Michael Porter • It a framework for the analysis of the structural factors that shape competition within an industry • The five forces: • Determine the profitability of an industry • Assess how attractive and potentially profitable is an industry Introduction (2) • This is a framework for understanding an industry or an organisation’s position with respect to the forces operating in the microenvironment • It can be used to explain the performance of competitors in a
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limitations of supple demand forces is a socially undesirable outcome as in the case of a market structure that is characterized by monopoly. This is where one single firm will control all production resources and therefore has exploitative capabilities in the terms of pricing and promoting. One example can be that of an electric company that has a virtual monopoly over production resources of a specific region and charge whatever prices they want. Coca Cola Co. is ran in a beverage industry that
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is not possible Imperfect market : * There are four types of imperfect markets: - Monopoly (only one seller) * Oligopoly (few sellers of goods) * Monopolistic competition (many sellers with highly differentiated product) * Monopsony (only one buyer of a product) In this market scenario, the seller enjoys the luxury of influencing the price in order to earn more profits. Monopoly: A market in which a single firm sells a product and that does not have any close substitutes
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Market Structures and Maximizing Profits /XECO/212 Principals of Economic In this paper I will discuss competitive markets, monopolies, and oligopolies and what role each of these plays in an economy? I will also point out: o What the characteristics of each market structure is? o How the price is determined in each market structure in terms of maximizing profits? o How output is determined in each market structure in terms of maximizing profits? o What are the barriers to
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to accrue market power. Such legislation often regulates mergers and sometimes introduces a judicial power to compel divestiture. A firm usually has market power by virtue of controlling a large portion of the market. In extreme cases—monopoly and monopsony—the firm controls the entire market. However, market size alone is not the only indicator of market power. Highly concentrated markets may be contestable if there are no barriers to entry or exit, limiting the incumbent firm's ability to raise
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Elasticity and Curves 5. Equilibrium of Firm and Industry Under Perfect Competition 6. Pricing under Perfect Competition – Demand and Supply 7. Applications of Demand and Supply Analysis under Perfect Competition 8. Joint Demand and Supply 9. Monopoly 10. Monopsony and Bilateral Competition 11. Monopolistic Competition 12. Duopoly and Oligopoly 13. Objectives of Business Firm 14. Profit Maximisation Theory 15. Pricing of Public Undertaking 16. Linear Programming 5. FACTOR PRICING 1. National
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Exam August 2007 1. Which of the following answers is a condition for non-cooperative strategic behavior (chapter 11)? a) preventing resales b) advantage c) commitment d) both answers b and c are correct 2. Which of the following condition(s) does a governmental institution aim for in correcting market inefficiencies? (chapter 20) a) Correcting deviations from perfect competition in b) redistribution of incomes c) stimulating the appliance of the following productionrule
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Introduction Written by John Steinbeck in 1939, “The Grapes of Wrath” is an in-depth look at how economic forces of the time had a tragic effect on the lives of the working class. The story and examples of the five economic structures are told, as the Joad family travels to seek a new life in California. The novel details how the economic changes that were taking place impacted the Joads and the people of Oklahoma, making them desperate to find a new life. Forced from their homes and land, they
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