Introduction Economists group industries into four distinct market structures: pure competition‚ pure monopoly‚ monopolistic competition‚ and oligopoly (McConnell & Brue 2004). Understanding the different market structures will help to understand how price and output are determined and will also help to evaluate the efficiency or inefficiency of those markets (McConnell & Brue 2004). This paper will briefly explain each market structure and will also explain how Quasar Computers evolved through
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ECONOMICS FEBRUARY 19‚ 2010 During this previous week‚ our learning team began discussing the topic of market structures. According to our readings‚ there are four different types of market structures such as pure competition‚ a pure monopoly‚ a monopolistic competition‚ and an oligopoly. Each one of these market structures are diverse in definition‚ characteristics‚ and in application‚ which will be further explained later in detail. We had learned that each one of these four
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market‚ such the supermarkets‚ where the market only determines price. The opposite market structure monopoly‚ a single firms dominates the market‚ can determine both its price and output. Finally there are imperfect markets like oligopoly‚ where a couple of firms have monopoly over a product‚ and then monopolistically competitive markets. As it implies it’s a mix of perfect competition and monopoly where the Mp3 player is operating in. “Monopolistic competition is the form of imperfect competition
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ECO 561 Final Exam w/ corrected answers 1) Suppose that in the clothing market‚ production costs have fallen‚ but the equilibrium price and quantity purchased have both increased. Based on this information you can conclude that A. the supply of clothing has grown faster than the demand for clothing [B. demand for clothing has grown faster than the supply of clothing] C. the supply of and demand for clothing have grown by the same proportion D. there is no way to determine what has
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competition should lead to the optimum allocation of | | |resources. | |Monopoly |A monopoly is a firm that dominates the market and in the case of a pure monopoly | | |has a 100% market share (produces the entire output of the industry). A monopolist | | |will have
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Simulation Quasar Following an economic analysis on the company Quasar Computers‚ based in the computer industry to understand pricing strategies and market competitiveness. First‚ identify the pricing strategies and price in each market structures: monopoly‚ oligopoly‚ monopolistic competition and perfect competition. Second‚ we describe the relationship between technology‚ research‚ development and economic efficiency and then justify the investment in these areas to maximize the economic benefits
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Fall 2010 1 / 25 Outline 1 Understanding Oligopolies 2 Game Theory The Prisoner’s Dilemma Overcoming the Prisoner’s Dilemma 3 Antitrust Policy Herriges (ISU) Ch. 15 Oligopoly Fall 2010 2 / 25 The Oligopoly Monopolies are quiet rare‚ in part due to regulatory efforts to discourage them. However‚ there are many markets that are dominated by a relatively few firms‚ known as oligopolies. The term oligopoly comes from two Greek words: oligoi meaning “few” and poleein
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consumers the price they are willing to pay‚ a firm can increase its profits at the expense of consumers’ surplus (see Figure 1.) This‚ of course‚ happens when that firm has market power to discriminate-when the market is oligopolistic or the firm is a monopoly (there is little price discrimination in the market for washing powder‚ for example). There are three degrees of price discrimination: the first degree means charging each consumer as much as she wants to pay‚ therefore extracting all the consumer
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limited companies that control the market. This type of market structure has a competition which they must constantly be working on improvements to compete with rivalry companies. d) A monopoly has high entry barriers with only one firm. This single firm also doesn’t really have any competitors. In a monopoly‚ this
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characteristics‚ it may be possible to identify a limited number of market structures that can be used to analyze decision making. TYPES OF MARKET STRUCTURE Economists usually classify market structures into four main types: Perfect Competition‚ Monopoly‚ Monopolistic Competition and Oligopoly. These types of market structure are different according to the following characteristics: CHARACTERISTICS OF MARKET STRUCTURE - Number and Size Distribution of Sellers. The ability of an individual firm
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