Microeconomics Monopolistic Competition

Microeconomics Monopolistic Competition - Microeconomics:...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Microeconomics: Monopolistic Competition 30/11/2007 14:33:00 Firms produce the quantity that minimizes average total costs in the long run.  Imperfect Competition: Monopoly: “Single Seller” Oligopoly: “Few Sellers” Monopolistic Competition: Many Sellers, each with a differentiated product. Monopoly: ex. Charter Cable in Athens Oligopoly: ex. The market for wireless telephone service. Monopolistic Competition: Convenience Stores, Gas stations They provide a similar product but they are different.  Five Sources of Monopoly: 1. Exclusive control over important inputs  o Ex. Perrier’s Mineral Spring. 2. Economies of Scale (natural  monopoly) o Ex. Local telephone service o If as quantity increases average total costs go down then you have an  economy of scale.  (Bulk Pricing, specialization) o When, at greater quantities the average costs start to increase we 
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 3

Microeconomics Monopolistic Competition - Microeconomics:...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online