Monopolistic Competition - 13794 Words

CHAPTER 25 Monopolistic Competition and Oligopoly Topic Question numbers ___________________________________________________________________________________________________ 1. Monopolistic competition: definition; characteristics 1-17 2. Demand curve 18-24 3. Price-output behavior 25-78 4. Efficiency aspects 79-88 5. Oligopoly: definition; characteristics 89-112 6. Concentration ratio; Herfindahl Index 113-140 7. Game theory 141-156 8. Kinked-demand curve model 157-176 9. Collusion; cartels; price leadership 177-194 10. Advertising 195-200 11. Efficiency aspects 201-204 12. Review of four structures 205-226 Consider This 227-228 Last Word 229-233 True-False 234-258†¦show more content†¦C) the industry would more closely approximate pure competition. D) the likelihood of collusive pricing would increase. Answer: C Type: A Topic: 1 E: 461 MI: 217 10. Economic analysis of a monopolistically competitive industry is more complicated than that of pure competition because: A) the number of firms in the industry is larger. B) monopolistically competitive firms cannot realize an economic profit in the long run. C) of product differentiation and consequent product promotion activities. D) monopolistically competitive producers use strategic pricing strategies to combat rivals. Answer: C Type: A Topic: 1 E: 461 MI: 217 11. A monopolistically competitive industry combines elements of both competition and monopoly. The monopoly element results from: A) the likelihood of collusion. C) product differentiation. B) high entry barriers. D) mutual interdependence in decision making. Answer: C Type: D Topic: 1 E: 462 MI: 218 12. Nonprice competition refers to: A) low barriers to entry. B) product development, advertising, and product packaging. C) the differences in information which consumers have regarding various products. D) an industry or firm in long-run equilibrium. Answer: B Type: A Topic: 1 E: 461 MI: 217 13. A significant difference between a monopolistically competitive firmShow MoreRelatedMonopolistic Competition2932 Words   |  12 PagesContents Question 1.1 – Monopolistic Competitors 3 Question 1.2 Non-price competitors 5 Question 1.3 – Substitutes Compliments 6 Perfect substitutes as in the Chocolate Industry: 7 Perfect complement 8 Question 2.1 - Structuralist model of the inflation process 9 Question 2.2 - Inflation targeting approach 9 References 9 Question 1.1 – Monopolistic Competitors Monopolistic competition is a market situation in which there is a large number of sellers and large number of buyers whereas monopolyRead MoreMonopolistic Competition in the Retail Industry986 Words   |  4 PagesMonopolistic Competition in the Retail Industry The retail industry is a prime example of the modern version of Chamberlin and Robinson’s model of Monopolistic Competition (Grewal, 441). The retail industry consists of vast markets with different brands and goods of one common goal, to sell their products. To cater to this rapidly changing market many large scale retailers are findings ways to make their product more appealing to the public in hopes of gaining market share over their competitionRead MoreMonopolies, Oligopoly, Monopolistic Competition, And Perfect Competition1085 Words   |  5 Pagesstructures it is important to know the different types of markets that there are. Understanding barriers, buyers and sellers with knowing the market share and competition is important to understand what barriers are occurring in the market. The different market structures are Monopoly, Oligopoly, Monopolistic Competition, and Perfect Competition. Understanding these different type of market structures helps to better understand what type of market is currently occurring. A monopoly is when the companiesRead MoreThe Types Of Market, Monopolistic Competition, Oligopoly, And Monopoly803 Words   |  4 Pageswhich discusses the four types of markets: perfect competition, monopolistic competition, oligopoly, and monopoly. In order to review this effectively there must be an understanding of the terms. According to our text, perfect competition involves products competing clients and that they offer corporations less potential profits than imperfectly competitive markets do. (Bryd, Hickman and McPheson, ) The text also referenced imperfect competition and this is when entry is restricted or goods areRead MoreMarket Structures : Perfect Competition, Monopoly, Monopolistic Competition And Oligopoly2078 Words   |  9 Pagesmarket structures – perfect competition, monopoly, monopolistic competition and oligopoly, and thei r determinations of price and output. It also discussed the possibility for firms to generate profits in the short-run and/or in the long-run within these four market structures. It will be shown in the discussion that both monopolistic and oligopolistic firms are able to generate profits in both short-run and long-run, while firms in perfect competition and monopolistic competition could only make profitsRead MoreMp3 Player Industry Monopolistic Competition1314 Words   |  6 PagesNishant Nagesh Pai | | 06/12/2010 | 1. To what extent is the market for MP3 players an example of monopolistic competition? Show using diagrams the effects on the Apple iPod of increased competition from other firms successfully entering the market. Introduction The first Mp3 player was launched in the market in the late 90’s (Pham-Gia,2009). However it was due to the emergence of the Apple iPod in the Mp3 player industry in October 2001 which changed the niche market into a booming marketRead MoreMonopolistic Competition and Oligopoly1973 Words   |  8 PagesCHAPTER 12 MONOPOLISTIC COMPETITION AND OLIGOPOLY REVIEW QUESTIONS 1. What are the characteristics of a monopolistically competitive market? What happens to the equilibrium price and quantity in such a market if one firm introduces a new, improved product? The two primary characteristics of a monopolistically competitive market are (1) that firms compete by selling differentiated products which are highly, but not perfectly, substitutable and (2) that there is free entryRead MoreMonopolistic Competition : Competitive Market Structure1757 Words   |  8 Pages Perfect Competition â€Å"Perfect competition is the market structure in which there are many sellers and buyers, firms produce a homogeneous product, and there is free entry into and exit out of the industry†(Amacher Pate, 2013) Real Life Examples A good example of perfect competition will be foreign exchange market because the currency is homogeneous. As well traders will have access to differentRead MoreMonopolistic Market Competition Of The Coffee Shop Industry Essay1291 Words   |  6 PagesMonopolistic Market Competition In the UK, the three leading competitive coffee brands are Costa Coffee (with 1,992 outlets), Starbucks Coffee Company (with 849 outlets) and Caffà ¨ Nero (with 620 outlets). They enjoy a 3-firm concentration of 53%; (Market concentration measures the market share of the largest companies in an industry) The coffee shop industry is a monopolistically competitive market; this entails a market situation where there are a lot of large companies competing, but each companyRead MoreAn explanation of monopoly, oligopoly, perfect competition, and monopolistic competition - a detailed overview946 Words   |  4 PagesOne of the key determinates to a successful national economy is the structure of its markets. The main market structures are: 1. Monopoly 2. Oligopoly 3. Perfect Competition 4. Monopolistic Competition Each of these market structures have unique characteristics, and can be classified according to three factors. The degree of competition, the first factor, is important as it classifies markets into different market structures. It compares the relative sizes of firms, the amount of sellers (vendors)