Directions: Read the descriptions of the businesses provided. Examine each description, decide which market structure best represents the company, and then justify your choice. 1. Josan's Salmon Supplier sells fresh salmon to local seafood restaurants. Every morning Josan sails out to sea to catch salmon, and each afternoon he returns to sell his catch to local restaurants. There are hundreds of other fishers catching and selling salmon. Josan cannot raise his price because the salmon he catches is identical to the salmon caught by the other fishermen. Type of Market structure: Reason: 2. Sardis Cable supplies cable access to all residents. It was a very expensive business to start. The entrepreneurs who started Cable had to provide underground wire for the entire community. Other companies tried to compete, but the start-up costs were simply too high. Type of Market structure: Reason: 3. M & H Soups produces a variety of soups. There is considerable competition in the soup market. However, M & H Soups has spent several million dollars on an advertising campaign to convince consumers that their soups are healthier than all other soups. Because of this advertising, M & H Soups charges a higher price than other soups on the market. Type of Market structure: Reason:
Directions: Read the descriptions of the businesses provided. Examine each description, decide which market structure best represents the company, and then justify your choice. 1. Josan's Salmon Supplier sells fresh salmon to local seafood restaurants. Every morning Josan sails out to sea to catch salmon, and each afternoon he returns to sell his catch to local restaurants. There are hundreds of other fishers catching and selling salmon. Josan cannot raise his price because the salmon he catches is identical to the salmon caught by the other fishermen. Type of Market structure: Reason: 2. Sardis Cable supplies cable access to all residents. It was a very expensive business to start. The entrepreneurs who started Cable had to provide underground wire for the entire community. Other companies tried to compete, but the start-up costs were simply too high. Type of Market structure: Reason: 3. M & H Soups produces a variety of soups. There is considerable competition in the soup market. However, M & H Soups has spent several million dollars on an advertising campaign to convince consumers that their soups are healthier than all other soups. Because of this advertising, M & H Soups charges a higher price than other soups on the market. Type of Market structure: Reason:
Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter10: Price-searcher Markets With Low Entry Barriers
Section: Chapter Questions
Problem 15CQ
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