various countries. (Figure 1) These industries either have a market structure in which a small number of inter-dependent firms dominating the industry‚ that of a oligopoly‚ or are firms that is the only seller of a good or service that does not have a close substitute‚ characteristics of a monopoly. Oligopoly and/or monopoly arise for four main reasons: government restriction to the entry of more than one firm into a market‚ an individual firm commands control over a key resource
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sellers. The market structure of the industry helps to determine its ability to set prices and make profits. The UK airline industry contains a number of different types of companies from budget airlines to private jets‚ but is essentially is an Oligopoly. This is due to the very high barriers to entry and the relatively small number of large firms due to this. Within the UK airline industry there is potential for collusion due to the small amount of large companies which means that there is
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............ 3 2. Market characterization............................................................................. 4 2.1. Definition of a free competitive market................................................ 4 2.2. Definition of a collusive oligopolistic market....................................... 4 2.3. Description of the Ohio school milk market.......................................... 5 3. Key economic issues...............................................................
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they can be collusive or non-collusive. Obviously‚ in some markets‚ the oligopoly can be part monopoly. Another factor is that some participants of these markets may‚ from time to time‚ receive legal challenges from others. Evaluate the effectiveness of competitive strategies within market structures Within each market structure‚ competition plays a role in the establishment of the market. Perfectly competitive markets lay the foundation for competition in monopolies‚ and oligopolies. To consider
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buying decisions with varied pricing structures and supply levels due to the nature of the market where such goods and services are being sold. There are generally four market structures‚ namely; perfect competition‚ monopolistic competition‚ oligopoly and monopoly. The latter three structures are also considered as imperfect competition. The type of market structure can be described by the number of sellers or firms‚ the nature of product‚ entry and exit barriers‚ and degree of control over
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B. Answers to Short-Answer‚ Essays‚ and Problems 1. What are the major features of monopolistic competition compared to pure competition and pure monopoly? In monopolistic competition‚ there are a relatively large number of firms‚ not the thousands of firms as in pure competition. The monopolistically competitive firms produce differentiated products‚ not the standardized products of pure competition. Product differentiation means that monopolistic competitors engage in some price competition
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corporations in that they are an oligopoly (Brown‚ 2010). According to Colander (2010)‚ “An oligopoly is a market structure in which there are only a few firms and these firms explicitly take other firms’ likely response into account when making decisions.” Furthermore‚ given that Oligopolistic firms are few‚ they are interdependent of each other and can either be collusive or noncollusive. It is this interdependence amongst the firms that distinguish them as an oligopoly vice a competitive monopoly
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oligopolistic firms are affected by both interdependence and uncertainty when selling their product. An oligopoly is a market structure in which it is dominated by a small number of firms who have a high concentration ratio of the market and so have the ability to collectively exert control over supply and market prices. An oligopoly firm would face uncertainty‚ if they were taking part in collusive acts. Collusion is an agreement between two or more firms‚ sometimes illegal and therefore secretive
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There are mainly five key players in the supermarket industry- Tesco‚ Asda‚ Sainbury‚ Safeway and Morrisons (ChinaCCM). Thus‚ the supermarket industry in the UK could be described as an Oligopoly Market. Oligopolies lie between the definitions of perfect competition and pure monopoly. Firstly‚ there are several sellers but only a few big companies who have a large market share in the industry. In the UK‚ the five big supermarkets totally have 3/4th of the market share (123help me! com). Secondly
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fall between these two extreme market structures. But in this essay we’ll talk about oligopoly. It is imperfect competitive market state therefore here there are few no. of sellers. Oligopoly covers many kinds of industrial behaviours and structures because of its broad nature. Oligopoly is a market condition where few numbers of sellers (oligopolists) come together and form a market or an industry. An oligopoly may have 2 firms or 20 firms‚ selling and producing differentiated or undifferentiated
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