Free Essays on Monopoly to Get Inspired & Learn by Example

Many different sellers and buyers exist within a marketplace (Hildebrand, 2009). It implies that there is competition within the market that allows price to fluctuate in response to shifts in supply, as well as demand. Besides, for almost each commodity there exist substitutes, for that reason, whenever a commodity becomes expensive, a purchaser may prefer a cheaper commodity or substitute. In any given marketplace having many sellers as well as purchasers, the supplier and consumer have an equal chance to influence cost or price of transactions (Mankiw & Taylor, 2006). In some sectors, substitutes do not exist and for that Continue reading...

A monopoly is a market structure dominated by only one supplier who supplies a particular product or service which does not have substitutes (Mankiw, pg 330). Monopolies exist because there is restriction of entry into a particular market. The existence of monopoly leads to market failure in an economy. Monopoly power means the ability to set prices by a monopoly firm. Entry into the market is restricted because of the high initial costs involved, complexity of operation, the nature of the product or service, economies of scale and existence of patents, trademarks, copy rights and franchise. The existence of Continue reading...

Market structures Description

Monopoly market
This is a type of market that features one, if not all, of the characteristics of a monopoly such as supply constraints, high price levels or excessive entry barriers. Due to the type of market, it mainly entail of a single supplying firm and consumers can only buy from this single firm. Without good control or legislation, this firm has the power to increase prices without adversely impacting demand for its services/products. This kind of market is in contrast to a perfectly competitive market.Oligopolistic market
This is a situation where a certain market is controlled by a Continue reading...

Consulting Mayor

1. Describe each market structure discussed in the course (perfect competition, monopolistic competition, oligopoly, and monopoly) and discuss two of the market characteristics of each market structure.
Perfect competition is the market type where every agent in the economy has full information about the market (full information assumption); there is no barrier to entering to or exit from the market (free entry and exit assumption); there are a large number of buyers and sellers (atomicity assumption); and products are similar to each other (identical products assumption). The main idea in the perfect competition market is that no agent or Continue reading...

Introduction

Market failure is an economic term that is indicative of a situation in which there remains wide gap between demand and supply. In this situation, the quantity of products demanded by the customers does not equate to the quantity supplied by the suppliers as a result of which the market equilibrium allocation becomes inefficient (Pasour, 1995). Either the goods or services are over or under produced, resulting in market failure. Market failure takes place due to a variety of reasons, including monopolized market situation, negative externality, positive externality, public goods, inequality or unfair distribution of resources in a free Continue reading...

A perfectly competitive firm is a price taker in the market. Since there are a large number of firms producing homogeneous products each firm cannot influence the market price by his/her activity since each firm produces only a small part of the whole industry output . So, the demand curve facing a firm in a perfect competition is infinitely elastic.
A monopolist is a price maker. Since the monopolist is the only seller in a market with a large number of buyers, the monopolist can influence the price by his output decisions. The monopolist faces a downward sloping demand curve . Continue reading...

Industry Analysis

Nike operates in the global sports apparel industry. It is one of the market leaders in the sports apparel market and its market share has increased from 3.9% in 2007 to 4.9% in 2012 and it is expected to grow to a 6.5% which shows that the pace of the growth of the company exceeds the industry average, especially in the period mentioned above. The world sports apparel market has an expected value of $126 billion in the current year i.e. 2015. The market trends in this industry are driven by health and more active lifestyles with the older Continue reading...

The concept of a “Natural Monopoly” relates to monopoly in general and still constitutes its special type. Natural monopoly occurs due to objective reasons and represents a situation where the demand for certain product would be better and more efficient met by one or few entities. Natural monopoly is usually caused by specific manufacturing technology and customer service, so under such circumstances the competition is impossible or undesirable. In 1977 William Baumol presented a classic definition for natural monopoly, “ an industry in which multiform production is more costly than production by a monopoly” (As cited in Yevdokimov, 2012, p. Continue reading...

Google Company faced antitrust allegations over two accounts. The major problems were on the existence of monopoly power and predatory conduct undertaken to attain or maintain the power. Monopoly comes into play through the manner in which it offers its services across the world. Other stakeholders in the service complained of how most users preferred Google services as compared to theirs under the same circumstances. The other issue surrounding monopoly are the steps taken by the company to ensure that most of the clientele appreciate its services and appreciate the steps taken to ensure that the same is taken. Continue reading...

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PERFECT COMPETITION

A market can have different structures depending on different characteristics of competition within that particular market. A perfectly competitive market is at one extreme, where there are several consumers and producers, with no barriers to entry or exit the market, perfect information regarding goods, homogeneous products, and property rights of individuals. This gives birth to a system where no individual economic factor is able to affect the prices of goods, which means producers are price takers, it’s their choice how much quantity to produce, but they cannot decide the market price at which they can sell Continue reading...