A small business owner analyzes how changes in the price of raw materials will affect the company's production costs and output levels. This scenario highlights the importance of understanding: A) Consumer preferences B) The law of diminishing returns C) Market demand D) Oligopoly behavior
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A small business owner analyzes how changes in the price of raw materials will affect the company's production costs and output levels. This scenario highlights the importance of understanding:
A) Consumer preferences
B) The law of diminishing returns
C) Market demand
D) Oligopoly behavior
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- The long-term planning in the oligopoly market should consider the reactions of other participants. In other words, any decision taken in an oligopoly market should have a cooperative outcome.Cooperation in an oligopoly means that the competing businesses collectively make the decision to cooperate which makes them stand in a better position. It increases the profitability of all firms involved. Please Answer the following question: How is a cooperation achieved by firms? Please discuss.This assignment is designed to develop skills in collecting and assessing market information and presenting clear written communication about how market structure affects the conduct and performance of firms in an industry. Select one of the three oligopoly markets in Singapore: Telecommunications Supermarkets Ride-Hailing apps Your assignment should address the following questions: 1. 2. 3. How does the market structure (number of firms that compete in a market & relative size of the firms) affect the conduct or behaviour of firms in your chosen industry (price markups & amount spent on advertising) and their performance (profits)? Using one or more Oligopoly models (Sweezy, Cournot, Stackelberg, Bertrand), analyse how firms in your chosen industry make and respond to their competitors' output and pricing decisions. What are the pricing strategies (2nd degree, 3rd degree, Versioning, Bundling, Tying) that firms in your chosen industry implement, and discuss how…Suppose an established manufacturer in an oligopoly market introduces 10 new varieties of products in the same year. Which of the following is a possible outcome of this action? Group of answer choices It will reduce the startup cost for a new entrant. It will lead to a decrease in the demand for the products of the manufacturer. It will lead to a fall in the profit earned by the firm. It will crowd out new entrants into the market. It will help the manufacturer increase the price of its products.
- Price leadership represents a situation where oligopolistic firms Multiple Choice reduce their reliance on nonprice competition. form a cartel. face a kinked demand curve. tacitly collude.Determine whether each of the following scenarios best reflects features of Sweezy, Cournot, Stackelberg, or Bertrand duopoly: a. Neither manager expects her own output decision to impact the other manager’s output decision. b. Each manager charges a price that is a best response to the price charged by the rival. c. The manager of one firm gets to observe the output of the rival firm before making its own output decision. d. The managers perceive that rivals will match price reductions but not price increases.Principles of EconomicsTitle: Market Structure Analysis Objective: The objective of this assignment is to analyze and compare the market structures of a company that fits the definition of a monopoly, a monopolistic competition, and an oligopoly. Students will gain insights into the business strategies, market behavior, and implications for consumers and competition in different market structures. Instructions: 1) Company Selection - Each group should choose one company that clearly fits the definition of either a monopoly, monopolistic competition, or oligopoly. The selected companies can be local or international. 2) Market Structure Identification - Identify and describe the market structure in which each selected company operates. Provide evidence and reasons for classifying the company under the chosen market structure. 3) Characteristics Analysis - For each company, analyze and discuss the characteristics associated with its respective market structure. Consider factors…
- OLIGOPOLY 1.- Each of two firms, firms 1 and 2, has a cost function C(q) = 30q; the inverse demand function for the firms' output is p = 120-Q, where Q is the total output. Firms simultaneously choose their output and the market price is that at which demand exactly absorbs the total output (Cournot model).(a) Obtain the reaction function of a firm.(b) Map the function obtained in (a), and graphically represent the Cournot equilibrium in this market.(c) Repeat (b), this time analytically.(d) Now suppose that firm 1's cost function is C(q) = 45q instead, but firm 2's cost is unchanged. Analyze the new solution in the market.(e) Obtain the total surplus, consumer surplus, and industry profits in both cases, and compare. What is the effect of the worsening in firm 1's cost?An oligopolistic market structure is distinguished by several characteristics, one of which is difficult entry. What are some other characteristics of this market structure? Check all that apply. Market control by many small firms a) Market control by a few large firms b) Mutual interdependence c) Mutual dependence d) Either similar or identical productsWhy do oligopolies exist? Group of answer choices 1-A small number of firms have established barriers to entry using economies of scale, patents, and sheer size to prevent other firms from challenging them. 2-The members of an oligopolistic market have signed agreements that divide the market such that no other firms will be able to achieve their level of profits. 3-The oligopolistic firms are created, run, and supported by the government. 4-The members of an oligopolistic market are producing in the upward sloping range of their long run average cost curves.
- Suppose that two Japanese companies, Hitachi and Toshiba, are the sole producers (i.e., duopolists) of a microprocessor chip used in a number of different brands of personal computers. Assume that total demand for the chips is fixed and that each firm charges the same price for the chips. Each firm’s market share and profits are a function of the magnitude of the promotional campaign used to promote its version of the chip. Also assume that only two strategies are available to each firm: a limited promotional campaign (budget) and an extensive promotional campaign (budget). If the two firms engage in a limited promotional campaign, each firm will earn a quarterly profit of $14 million. If the two firms undertake an extensive promotional campaign, each firm will earn a quarterly profit of $11 million. With this strategy combination, market share and total sales will be the same as for a limited promotional campaign, but promotional costs will be higher and hence profits will be lower.…What is the best example of an oligopolistic market? Question 4 options: Government monopoly on postal services. Foreign exchange market. Restaurant business with thousands of competing companies. Fourteen biggest car manufacturers.Q1) Which one of the following statements about Cournot oligopoly model with N firms is incorrect? 1)The result with unspecifed N firms can be applied to N=1. 2)If N>1 and there exists a unique Nash equilibrium, then the market price cannot depend on N. 3)If the model is symmetric and there exists a unique Nash equilibrium and N approaches infinity, then the market price approaches to the marginal cost, i.e., the perfectly competitive price. 4)The result with unspecified N firms can be applied to N approaching infinity. Q2) Which of the following statements about the classic Cournot duopoly model is incorrect? 1)The products of the two firms are homogeneous. 2)It is a static game with complete information. 3)The two firms decide on their prices and let their quantities be dictated demand conditions. 4)There exist examples that have unique Nash equilibrium points.