gs_-18_--_Summary_Market_Structures_

Gs-18_Summary_Ma - ANNOUNCEMENTS#1 SCHEDULE OF EXAMS(Tentative o TEST#1 DONE oTEST#2 Feb 5 2010 o TEST#3 first week March 2010(TBA o FINAL EXAM

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
1 1/27/2010 Econ 11 -- Lecture #18 1 ANNOUNCEMENTS (#1): ± SCHEDULE OF EXAMS (Tentative): o TEST #1 –– DONE! o TEST #2 –Feb. 5 , 2010 o TEST #3 – first week March, 2010 (TBA). o FINAL EXAM – Announced during FINAL EXAM WEEK 1/27/2010 Econ 11 -- Lecture #18 2 Lecture 18: SUMMARY: MARKET STRUCTURES ± OLIGOPOLY ± SUMMARY OF MARKET STRUCTURES ± SPECIAL STUDY: MARKET STRUCTURE OF A WHOLE INDUSTRY 1/27/2010 Econ 11 -- Lecture #18 3 OLIGOPOLY ± THERE ARE A FEW SELLERS. ± EACH SELLER IS SIGNIFICANT RELATIVE TO THE MARKET. ± COMPETITION IS INTENSE (& RUINOUS) o PRICE COMPETITION o QUANTITY COMPETITION. ± A COLLUSION OF AMONG SELLERS COULD RESULT ( Ù CARTEL) o STEADY PRICE. o STEADY MARKET SHARING.
Background image of page 1

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

View Full DocumentRight Arrow Icon
2 1/27/2010 Econ 11 -- Lecture #18 4 OLIGOPOLY (KINKED DEMAND HYPOTHESIS): Illustration 1/27/2010 Econ 11 -- Lecture #18 5 MC D D d d MR mr Quantity Price 0 P 0 Q 0 dd, or flat (or elastic ) demand schedule, for price increases; DD or steep (or inelastic ) demand schedule for price decreases. This makes price at P 0 stable or rigid . The kinked demand schedule in oligopoly 1/27/2010 Econ 11 -- Lecture #18 6 D D d d MC MR mr Quantity Price 0 P 0 Q 0 In this situation, the MC schedule intersects the MR where it falls in the kink of the demand schedule. At that point, the MR is indeterminate. Still the firm maximizes profit here. The kinked demand schedule in oligopoly
Background image of page 2
3 See Table 9-2. SUMMARY: TYPES OF MARKET STRUCTURE 1/27/2010 Econ 11 -- Lecture #18 8 SUMMARY: NUMBER OF SELLERS ± Pure competition – very plentiful ± Monopolistic or differentiated competition – many ± Oligopoly –few ± Monopoly – only one 1/27/2010 Econ 11 -- Lecture #18 9 SUMMARY: DEGREE OF PRODUCT DIFFERENTIATION ± Pure Competition – Product is homogeneous ± Monopolistic or Differentiated Competition Seller attempts to make the product unique and “different” (but it has many subsitutes) ± Oligopoly – Product could be differentiated or homogeneous ± Monopoly – Often homogeneous, but the monopolist attempts to differentiate it through price discrimination and other means
Background image of page 3

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

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/18/2010 for the course SE 67256 taught by Professor Dr.gerardosicat during the Spring '10 term at University of the Philippines Diliman.

Page1 / 10

Gs-18_Summary_Ma - ANNOUNCEMENTS#1 SCHEDULE OF EXAMS(Tentative o TEST#1 DONE oTEST#2 Feb 5 2010 o TEST#3 first week March 2010(TBA o FINAL EXAM

This preview shows document pages 1 - 4. Sign up to view the full document.

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