ECON: MICRO4 (New, Engaging Titles from 4LTR Press)
4th Edition
ISBN: 9781285423548
Author: William A. McEachern
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 10, Problem 2.5PA
To determine
Whether the firms in an oligopoly act independently or interdependently.
Concept Introduction:
Oligopoly refers to a market which is dominated by a small number of large sellers (oligopolists).
Oligopoly has its own market structure.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
1.Microsoft is one of the leading software companies. Prior to 2000, Microsoft’s share of the market for personal computer operating systems stood above 80 per cent. However, since the twenty-first century Microsoft’s market share has steadily declined to 40 per cent. This is due to the rise in competing software producers such as Apple macOS (10%), Google's Android OS (35%), Linux Operating System (35%), and Apple iOS (5%). The market share of each company is provided in parentheses. Google and Linux have decided that it would be in their best interest to work together to serve the market. This is not common knowledge to the person’s outside of the companies.
i. Draw how equilibrium price and quantity are determined in this industry. Hi does this refer to the monopoly market structure diagrams?
2. Allsmart’s demand curve is given by Q=10-P for its dishwashers. The marginal and average cost is $3 per dishwasher produced. Complete the following table. Photo below concerns…
Sg3
Economics
An industry produces its product, Scruffs, at a constant marginal cost of $50. The market demand for Scruffs is equal to
Q=75,000−500PQ
What is the value to a monopolist who is able to develop a patented process for producing Scruffs at a cost of only $45? $_____________
If the industry producing Scruffs is purely competitive, what is the maximum benefit that an inventor of a process that will reduce the cost of producing Scruffs by $5 per unit can expect to receive by licensing her invention to the firms in the industry? $________________
Question1
Next time you are shopping at the supermarket (or imagine you are there), what is a good example of a good (not a brand name) that is sold in an oligopoly market? What is the good? What are the major manufacturers (be sure to turn the package over so you are now confusing brand names with the manufacturer)? Which characteristics of an oligopoly market are shown here (few dominant producers; identical prices; high barriers to entry)?
Chapter 10 Solutions
ECON: MICRO4 (New, Engaging Titles from 4LTR Press)
Knowledge Booster
Similar questions
- 21- A town in India has three Milk producing companies. The owners of these milk companies make decisions together about when to raise and lower milk prices. It would be difficult for another milk company to enter this market. Which market structure best describes this market? a. Perfect competition b. Oligopoly c. Monopolistic competition d. Monopolyarrow_forwardCase Study Microsoft in India Microsoft made its name by building two monopolies, its Windows operating system and its Office suite of personal productivity software, that are used the world over. Windows, for example, runs on about 94 percent of the world’s personal computers. Despite its global dominance, however, Microsoft has found it difficult to get traction in many developing nations. India is a case in point. Although the country has a well-educated middle class, and although India is home to some of the world’s most successful information technology outsourcing companies, the vast majority of Indians do not have access to a personal computer. India has only 25 PCs per thousand people compared to 997 per thousand in the United States. The main reason for this is cost! Most Indians are simply too poor to afford a PC. Also, Microsoft’s Windows franchise faces two major competitors in India: pirated versions of Windows, and the free open source product Linux, which can be found…arrow_forwardCase Study Microsoft in India Microsoft made its name by building two monopolies, its Windows operating system and its Office suite of personal productivity software, that are used the world over. Windows, for example, runs on about 94 percent of the world’s personal computers. Despite its global dominance, however, Microsoft has found it difficult to get traction in many developing nations. India is a case in point. Although the country has a well-educated middle class, and although India is home to some of the world’s most successful information technology outsourcing companies, the vast majority of Indians do not have access to a personal computer. India has only 25 PCs per thousand people compared to 997 per thousand in the United States. The main reason for this is cost! Most Indians are simply too poor to afford a PC. Also, Microsoft’s Windows franchise faces two major competitors in India: pirated versions of Windows, and the free open source product Linux, which can be…arrow_forward
- 60A- What is the dominant strategy for Firm B? What is the dominant strategy for Firm A? Explainarrow_forward6. Suppose that the market for e-readers is an oligopoly controlled by Amazon, Barnes &Noble, Sony, and Apple. Barnes & Noble is considering increasing its output. How would this affect the market price? How would it affect the profits of each company?arrow_forwardQuestion 3: a. Explain the difference between and the economic relevance of fixed costs, sunk costs, variable costs, and marginal costs by using specific examples from everyday administrative activities. b. By using specific product markets briefly discuss the significant difference among the following market structures: (i) perfect competition, (ii) monopoly, (iii) monopolistic competition, and (iv) oligopoly. c. Why are externalities, public goods, and information asymmetry major problems in the market? Discuss.arrow_forward
- 23. The kinked oligopoly demand curve does NOT describe the demand curve for monopolistic competition because in monopolistically competitive markets.... a. Firms are not as interdependant as oligopolistic firms. b. Firms have no market power. c. There is not as much product differentiation as in oligopoly. d. There is no non-price competitionarrow_forwardQuestion 36 Oligopoly differs from monopolistic competition in that Group of answer choices oligopolies have few buyers, while monopolistically competitive markets have many buyers. oligopolies face downward-sloping demand curves, while monopolistic competitors face horizontal demand curves. mutual interdependence is essential in monopolistic competition. each monopolistically competitive seller produces a slightly differentiated product.arrow_forward56.Assume that an oligopoly's four enterprises are forming a pact to cooperate. How might the ease of entry into their industry influence how much they charge?arrow_forward
- 3- There are many sellers of abayas and dishdashas in Muscat. Each abaya and dishdasha seller makes their product slightly different from others. There is free entry and exit into this market. Which market structure is this situation referring to? a. Monopolistic Competition b. Perfect Competition c. Oligopoly d. Monopolyarrow_forward6.Define oligopoly in your own words and elaborate on the characteristics of oligopoly?arrow_forwardmedia economics course Question #1: A lot of media regulation is geared towards areas such as content (protecting children) and ownership. Why are these two areas so important, and how do they differ around the globe? Question #2: What is censorship, and why do some governments openly engage in censorship involving the media industries? In what ways will this continue to play a role in media and economics? Question #3: The Internet has raised a number of legal issues since its development. One hot issue in the 21st century is that of net neutrality. What is net neutrality, and what are the two main opposing views on the topic? Where do you stand on the subject of net neutrality? Question #4: What's the role of advertising in today's media economics? What are some policies involving advertising within the media landscape, especially within economics? Question #5: Define content regulation and its role in today's media economics? In what ways will content regulation shape the media…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of MicroeconomicsEconomicsISBN:9781305156050Author:N. Gregory MankiwPublisher:Cengage Learning
Principles of Microeconomics
Economics
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:Cengage Learning