DifferentiatingBetweenMarketStructures-TeamA

DifferentiatingBetweenMarketStructures-TeamA -...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Differentiating Between Market Structures 1 Differentiating Between Market Structures Angela Senn, Angela Shafer, Ashley Mack, Brenda Pannell, and Carl Meyer Principles of Economics ECO/212 University of Phoenix Kathy Kemper June 14, 2010
Background image of page 1

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

View Full DocumentRight Arrow Icon
Differentiating Between Market Structures The structure of a market is determined by how many businesses are in a particular market, the possibility of new businesses entering the market, and determining the pricing that will result in a profit. A market has four important structures; perfect competition, monopolistic competition, oligopoly, and monopoly. These structures allow a business determine demand and supply, barriers, elasticity, and inelasticity to be profitable or in some cases to close doors. Perfect Competition Monopolistic Competition Oligopoly Monopoly An example of an organization Eggland’s Best Coca-Cola Anheuser-Busch Microsoft Goods or services produced by the organization Farm Fresh Eggs Liquid Eggs Hard Cooked Peeled Eggs Soft Drinks Fruit Juices Sport Drinks Tea Coffee Water Many varieties of beers Monster Energy Drink Software and Hardware for personal and business computer systems Barriers to entry Zero barriers Low/inelastic demand, loyalty High/distributor agreements High to no entry customer loyalty/distributors Numbers or organizations Infinite amount Many Few One Price elasticity of demand-Perfectly elastic, perfectly inelastic, relatively elastic, and relatively inelastic with short reason why. Relatively elastic – small price changes lead to a very considerable change in quantity purchased. Relatively elastic with close substitutes Close Substitutes but many have their own tastes and at that point none would compare. Perfectly inelastic demand Other software exists but no comparison – Very Inelastic Is there a presence of economic profits? Answer for long and short run? Why? Yes there are economic profits if the firms’ revenue is more than its costs in the long and short run. Yes or no, the short run economic profit is realized when marginal revenue is equal to marginal cost No in the long run economic profit is zero because of Yes there is economic profit in the short and long run but they are dependent on other firms. Yes there is
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 7

DifferentiatingBetweenMarketStructures-TeamA -...

This preview shows document pages 1 - 3. Sign up to view the full document.

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