ipl-logo

Features Of Monopoly Market Structure

1346 Words6 Pages

2.1)

a) Long run production:

b)

Long run average cost curve

Long run average cost can be defined as the cost per unit of output possible where other factors of production are not fixed.

Long run average cost curve is also known as the ‘envelope curve’. If this curve is downward while the output is increasing, the firm has economies of scale. On the contrary, when this curve is upward, the firm has diseconomies of scale. If the curve is constant, the producer has constant returns to scale.

3

a) Features of perfectly competitive market structure:

• Number of firms: in this type of market structure, the production is done by large number of firms. Because of higher number of firms, a small portion of the total supply is contributed …show more content…

OK is the output of the firm and Op refers to the price. OPMK depicts total cost and OMPK is the total revenue. The profits of the firm are normal as OPMK=OPMK.

4

a) Features of Monopoly market structure:

• Number of firms: In the monopolistic market, there is only one seller or the producer of the products. But the number of buyers is large.
• Product differentiation: There is not any replacement for the product sold by the producers.
• Control over price: The firm which has the monopoly in this market has total control over supply and price. All the buyers have to accept the price determined by the monopolist.
• Extent of market information: In this type of market structure, the buyers have to be fully aware of the price and the market conditions for making decisions about the buying and selling.
• Freedom of entry: There are certain restrictions on freedom of entry of new firms as key functions are controlled by the monopolist.

b) Short run and long run equilibrium of the firm

Short run equilibrium under super normal …show more content…

The point where normal profits become possible, the firms are said to be in their long run equilibrium.

6.

a) Features of oligopolistic market structure

• Number of firms: In oligopolistic market structure, the number of firms is few. Every firm manufactures an important portion of the total production. There is competition among different producers and they try to affect price and production volume.
• Product differentiation: in this type of market, there are both types of products: homogeneous and differentiated products. The market with homogeneous products is perfect oligopoly and the market with differentiated products is called imperfect oligopoly.
• Control over price: Firms are able to affect the price. In oligopoly there is price rigidity. It’s a situation where prices stay fixed irrespective of changes in demand and supply.
• Freedom of entry: there are some barriers which restrict entry and exit of new firms like requirements of capital, patents etc.

7.

Show More
Related

  • Monopolies In The 1900s

    992 Words  | 4 Pages

    Corruption was prevalent in the United States during the 1900s. Fraud existed in major industries, such as monopolies or unsafe working conditions. Several people wanting reform wrote books and articles about the industries which made a large impact on the consumers and users of industries. This put pressure on the president to make changes in regulating these industries. Muckrakers, a group of journalists, exposed corrupt issues to the American public, which brought reform to many major industries such as oil, railroads, and government.

    Read More

  • Monopolies During The Gilded Age

    1345 Words  | 6 Pages

    Mark Twain, one of the most memorable American writers of the 19th century, coined the term “The Gilded Age” to describe the period from 1870 to 1900. This term was derived from the deceiving facade this era wore—the glamorous, glistening surface. This mask was only a thin layer, coating the various shades of corruption pervading beneath.11 The tranquil beauty of fine arts provided an outlet for people to escape from the suffocating grandiose nature of a tainted society ruined by the age of monopolies and corruption. During the momentous Gilded Age, a time period of rapid economic growth which generated vast wealth, new products and technologies were created that improved middle-class quality of life.

    Read More

  • Monopolies In The United States: The Gilded Age

    1971 Words  | 8 Pages

    The period from 1865 to 1900 was characterized by an astronomical boom in industry and manufacturing, economic growth for the rich, financial turmoil for the poor, and political corruption. As a result, the era has been named “The Gilded Age.” Just as something gilded is gold on the outside but worthless metal on the inside, these years seemed prosperous from an outside perspective, when in reality, the wealth gap was increasing at an alarming rate and big business had power over government officials. As a result of this, a lot of federal legislation was influenced by monopolies and often catered to the desires of businessmen. Since regulation of certain business practices would cause these trusts to lose money, Congress shied away from regulating

    Read More

  • Problems Jacob Riis Faced During The Progressive Era

    849 Words  | 4 Pages

    Web. 17 Nov. 2015. Some of these companies were monopolies. Monopolies were the business that tried to all control over their product so then they could price it at any price they wanted.

    Read More

  • Monopolies In The 1900's

    1151 Words  | 5 Pages

    Monopolies in the 1900’s had immense powers in the market, and were able to have complete control because they had such power. A monopoly is the “exclusive control of commodity, market or means of production” where the “power is concentrated in the hands of a select few” (Beattie). While monopolies do get jobs done and inquire a large amount of money, their success it at the expense of the people and the power they have obtained is abused. They started off liked by small businesses because it helped with shipping costs, but eventually monopolies became too powerful. They are more hurtful to the public than helpful, and the benefits they gain from being a monopoly hurts the public, making them a collective dilemma.

    Read More

  • Monopolies During The Progressive Era

    408 Words  | 2 Pages

    During the Progressive Era there were multiple of changes occurring that people became overwhelmed. New resources in the oil market, industrialization, fights for equality. There were many factory jobs, however, no one to stand up for the workers. So of course people will turn to their government for help, the power house of the country. However, even the government was picky in what they helped with.

    Read More

  • Roosevelt Monopolies Analysis

    579 Words  | 3 Pages

    Roosevelt was re-elected president of the United States (first time elected) in 1904 partly to break up trusts and monopolies. The public was outraged for decades by the ways trusts and monopolies were cheating in business. Roosevelt felt that the US government was responsible for the falls of many legitimate businesses, because they failed to prosecute trusts and monopolies (Roosevelt 222). As president, Roosevelt pledged to protect small businesses and sue monopolies and trusts by implementing the Sherman Antitrust Act to restore honest commerce and labor conditions. Railroad discrimination continued to exist when Roosevelt came into the presidency after President Mckinley’s assassination.

    Read More

  • Disney Oligopoly: The Market Structure Of Walt Disney

    1249 Words  | 5 Pages

    In spite of that, barriers to entry in an oligopoly market are high. The prime barriers are economies of scale, access to costly and sophisticated technology, patents and tactical measures by existing dominating firms devised to hinder new firms from entering the market. In addition, other sources of barriers include government regulation favoring incumbent firms making it difficult for nascent firms to

    Read More

  • Porter's Five Forces For Bicycle Industry

    724 Words  | 3 Pages

    When capital markets are enables to offer funds, increase the risk of competitive entrants. The industry will becomes a magnet to new if a firm have a very high profit. Unless got way we can solve this problem if not the competition and competitor will increase. Firms in an industry try to keep the new entrants low by barriers to entry, first is economies of scale. An economy of scale is when an industry is characterized by large economies of scale for new firms to enter and participate, if they are willing to accept a cost disadvantage.

    Read More

  • Case Study: Wal-Mart In South Korea

    2015 Words  | 9 Pages

    There are different ways to enter the foreign market (except the direct and indirect export of the goods): wholly owned subsidiaries, merger & acquisitions, joint ventures, franchising/licensing agreements and minority investments. After determining the entry mode the company will choose the market and evaluate it to find the best way to enter it. The different forms of market entry strategies have advantages and disadvantages. Standardization of market operations and processes are more different if a company chooses merger & acquisitions and joint ventures, because first the partnerships need to be harmonization. These partnerships are valuable because of the partner’s knowledge about the local market.

    Read More

  • Nike: A Monopolistic Market

    981 Words  | 4 Pages

    The type of market my paper is concentrating on is known as a monopolistic competition market. The first characteristic that differentiate a monopolistic competition market from the other 3 markets is that in a monopolistic competition, there are many sellers which would lead to competition between the firms to sell their products. The second characteristic is that monopolistic firms are relatively small, which can result in either new firms to enter the industry or firms that are existing to exit the market. The third characteristic is that the firms in the monopolistic market sell products that are similar but are slightly different compared to other firms in the same market. The last characteristic is that the firms in a monopolistic market

    Read More

  • Apple Business Ethics Case Study

    1848 Words  | 8 Pages

    The oligopoly market is set up in a way so that competitors can survive because each is unique and there are so few competitors that they are virtually indispensable even if some ethics atrocity

    Read More

  • Coca Cola Market Structure Analysis

    1093 Words  | 5 Pages

    Market structures describe the competitive environment in which a firm operates. The characteristics of the market structure will have a major-influence on the competitive strategies and tactics that are implemented by firms. (Octotutor, 2014). For the purpose of this analysis, I have chosen to analyze the Coco-Cola Company, which operates in an oligopoly. This type of market has many implications for both consumers and competing firms.

    Read More

  • Importance Of Market Structure

    1743 Words  | 7 Pages

    The market structure will affect how firm price their product in the industry. The market structure will affect the supply of different commodity in the market. When the competition is high there is a high supply of commodity as different companies tries to dominate the markets. A market structure will affect the barrier to entry for the companies that intend to join that market. A monopoly markets structure has the biggest level of barriers to entry while the perfectly competitive market has zero percent level of barriers to entry.

    Read More

  • Oligopoly Case Study

    1870 Words  | 8 Pages

    They are differentiated by their products such as soft drinks and soap powder. There also exist little firms who produce similar products such as petrol. However, in oligopoly, there are barriers to enter the market. Similar to monopoly, the barriers are no different, and it differs from one industry to the other. This is why the firms in oligopoly are interdependent with each other, because the firms all have large market shares and each of their actions would affect the rest, so any decision-making will be based on their competitors’ reactions.

    Read More

More about Features Of Monopoly Market Structure

Open Document