4-27-09 - Microeconomics Class Notes 4/27/09 Monopolistic...

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Microeconomics – Class Notes – 4/27/09 Monopolistic Competition Looks the closest to perfect competition Characteristics: Product differentiation – each firm makes a slightly different product Product Differentiation: Ways to separate your product from others 1. Different designs 2. Different formula/taste 3. Market segmentation tweak the product to maximize utility 4. Features 5. Advertisement when we advertise, they products being advertised may be very similar to those in the market a. Purposes of Advertisement: i. Convey (transmit) information – you now know something about the product you didn’t know about previously ii. Build the image of the company (or yourself!) 1. You buy a product to be part of a larger group (that is cool and different) iii. Build brand 1. Building an identity for the consumer if you buy this product, you will be in this group of people.
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Product space: what are the different characteristics that the competitors have Break the product space up
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This note was uploaded on 06/03/2009 for the course ECON 200 taught by Professor Nonnenmacher during the Spring '09 term at Allegheny.

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4-27-09 - Microeconomics Class Notes 4/27/09 Monopolistic...

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