market 3 - previously, they make up much of the dominators...

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Econ 1B Dr. Means 12/4/6 Market Structure I recently purchased Madden 2007, a video game, for the Play Station 2 console. The game has only been out on the market since August 2007, meanwhile, it is still considered to be a new release. The retail price varies from $44.99 to $54.99 depending on which store it is purchased from. I had wanted to purchase this game since its release, but I waited several months after its initial release. I was able to purchase the game for a retail price of $39.99 at Best Buy. The market for purchasing a Play Station 2 video game is an oligopoly, because it is a market form where the market is dominated by a small number of sellers. There are many stores that sell the same product, such as Circuit City, Target, Toys “R” Us, Fry’s Electronics, and etc. In respect to the main stores mentioned
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Unformatted text preview: previously, they make up much of the dominators of the market. Each oligopoly is aware of the others actions. The decisions of one firm influence, and are influenced by, the decisions of other firms. I was aware that these stores are competing against each other over business, so I tried to get myself the best deal. As the buyer, I set my buyer value for the Madden 2007 at $40, because I was not willing to pay at the retail price of $44.99+. These firms operate under imperfect competition, meanwhile the product these firms offer are differentiate and the barriers of entry are high. Four factors which are important to note with these barriers of entry are economies of scale, government licensing, patents, and control over an essential resource....
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