Business Analysis : The Corn Industry

993 WordsApr 20, 20164 Pages
1. A) restaurants are not perfectly competitive as they sell different products and services and are more monopolistically competitive. This means they are selli9ng imperfect substitutes. B) the Corn industry is perfectly competitive as it meets all the required assumptions. C) University Education is not perfectly competitive as some universities are not close substitutes for others allowing universities that are of better ‘class’ the power to set their own prices and regulations. D) Local radio and television are not perfectly competitive markets as they are more of a monopolistic structure due to different substitutes and channels etc. 2. Allocative efficiency is where a market only produces the goods and services that are the highest in demand and are the ‘want’ of society. It is achieved by a perfectly competitive market when the marginal benefit of a good or service is equal to its marginal cost. Productive efficiency is where a firm produces their product at the lowest average total cost possible. This is achieved in a perfectly competitive market when the equilibrium output is produced at the lowest minimum cost. The difference between the two is that productive efficiency means producing an item without waste and allocative efficiency means producing an item where profit is equal to its marginal cost. 3. An oligopoly is a section of the market in which only a handful of firms dominate the majority of the market share. Examples of this would be Coles and
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