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Why do you think game theory has become the preferred method of analyzing oligopolistic markets?
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How prevalent are black markets in today's world?
According to specialist websites and magazines such as The Economist, Investopedia and Freakonomics, black markets are extremely prevalent in today's world. It is estimated that black markets account for 22.67% of GDP and have become more prevalent during this particular world recession.
How did railroad companies become some of the most powerful businesses in the country?
American locomotives hauled more freight than those in any other country, and manufacturers and farmers were able to send their goods to distant markets.
How does productivity in a country affect equilibrium currency prices?
If one country's productivity increased relative to another's, the former country would become more competitive in world markets. The demand for its exports would increase, and so would the demand for its currency.
What is a oligopolies?
An oligopoly is an economic condition in which there are so few independent suppliers of a particular product that competitive pricing does not take place. Oligopoly is a form of market where there is domination of a limited number of suppliers and sellers called Oligopolists. A situation in which a particular market is controlled by a small group of firms.An oligopoly is much like a monopoly, in which only one company exerts control over most of a market. In an oligopoly, there are at least two firms controlling the market. An oligopoly is a market dominated by a few large suppliers. The degree of market concentration is very high. Firms within an oligopoly produce branded products and there are also barriers to entry. Another important characteristic of an oligopoly is interdependence between firms. This means that each firm must take into account the likely reactions of other firms in the market when making pricing and investment decisions. This creates uncertainty in such markets - which economists seek to model through the use of game theory. The retail gas market is a good example of an oligopoly because a small number of firms control a large majority of the market. Economics is much like a game in which the players anticipate one another's moves. Game theory can also be applied in this situations as if decision makers must take into account the reasoning of other decision makers. It has been used, for example, to determine the formation of political coalitions or business conglomerates, the optimum price at which to sell products or services, the best site for a manufacturing plant, and even the behavior of certain species in the struggle for survival.The ongoing interdependence between businesses can lead to implicit and explicit collusion between the major firms in the market. Collusion occurs when businesses agree to act as if they were in a monopoly position. KEY FEATURES OF OLIGOPOLY - A few firms selling similar product - Each firm produces branded products - Likely to be significant entry barriers into the market in the long run which allows firms to make supernormal profits. - Interdependence between competing firms. Businesses have to take into account likely reactions of rivals to any change in price and output THEORIES ABOUT OLIGOPOLY PRICING There are four major theories about oligopoly pricing: (1) Oligopoly firms collaborate to charge the monopoly price and get monopoly profits (2) Oligopoly firms compete on price so that price and profits will be the same as a competitive industry (3) Oligopoly price and profits will be between the monopoly and competitive ends of the scale (4) Oligopoly prices and profits are "indeterminate" because of the difficulties in modelling interdependent price and output decisions Distinct features of an oligopolistic market: - An oligopolistic market comprises a handful of firms, engaged in selling analogous products - All oligopolistic markets increase mutual dependence among the firms involved in similar competition. It also prepares businessmen to accept the outcomes arising from rivalries with respect to alterations in the production and prices of goods. - In near future, an oligopolistic market is likely to impose restrictions on admission, in an attempt to incur abnormal profits. - Each of the business houses involved with this market produces branded goods THE IMPORTANCE OF PRICE AND NON-PRICE COMPETITION Firms compete for market share and the demand from consumers in lots of ways. We make an important distinction between price competition and non-price competition. Price competition can involve discounting the price of a product (or a range of products) to increase demand. Non-price competition focuses on other strategies for increasing market share. Consider the example of the highly competitive UK supermarket industry where non-price competition has become very important in the battle for sales - Mass media advertising and marketing - Store Loyalty cards - Banking and other Financial Services (including Travel Insurance) - In-store chemists / post offices / creches - Home delivery systems - Discounted petrol at hyper-markets - Extension of opening hours (24 hour shopping in many stores) - Innovative use of technology for shoppers including self-scanning machines - Financial incentives to shop at off-peak times - internet shopping for customers Price leadership: Oligopolistic market The dominance of one firm in the oligopolistic market results in price leadership. Firms having less market shares only follow the prices fixed by leaders. Oligopolistic competition: Effects - Oligopolistic competition in most cases leads to collaboration of the business firms on issues like raising the prices of various goods and subdue production process. - Under other given market conditions, the competition between the sellers acquires a violent form, on the grounds of lowering the prices and increasing the production. - Collaboration of various firms also brings about stabilization in the unsteady markets. PRICE LEADERSHIP IN OLIGOPOLISTIC MARKETS When one firm has a dominant position in the market the oligopoly may experience price leadership. The firms with lower market shares may simply follow the pricing changes prompted by the dominant firms. We see examples of this with the major mortgage lenders and petrol retailers. In reality, it is the Oligopoly market which exists, having a high degree of market concentration. This indicates that a huge percentage of the Oligopoly market is occupied by the leading commercial firms of a country. These firms require strategic planning to consider the reactions of other participants existing in the market. This is precisely why an oligopolistic market is subject to greater risk of connivances.By: Schafaq ChohanAn oligopoly is a market form in which a market or industry is dominated by a small number of sellers. Barriers to entry are high.
What is is difference between Brazil and Mexico's economic system?
Both are emerging markets which stand as the 9th and 11th largest economies in the world, respectively (Brazil: US$1.98 trillion; Mexico: US$1.55 trillion). Also both apply the free market model, but the strategy used to grow differs greatly among both countries: Brazil is working to become a major supplier of natural resources, specially to China. Also, the Brazilian government is tying its national economy to the rather large internal market (population of 201 million) and is striving to become a regional economic leader in Latin America. On the other hand, since NAFTA was first implemented in 1994, Mexico has become an increasingly export-oriented economy, manufacturing added-value products for export into the American, European and Japanese markets. Proof is the export figure of US$230 billion, which ranks as the 17th in the world and almost doubles the exports of Brazil.
How can you be an economist?
Study economics at a university or college. Although you do not have study economics to become one. You need to have very good quantitative skills and be good at analyzing markets
How can you be economist?
Study economics at a university or college. Although you do not have study economics to become one. You need to have very good quantitative skills and be good at analyzing markets
What is the most preferred course to become business analyst?
B.b.m
What happens to markets when countries become communist?
They are completely controlled by the government.
Why should America care about Argentine economics?
America needs to care about the economics of many countries, including Argentina's, because as economies and markets become more global, the well-being of individual markets and economies become more dependent on the economies and markets of others. As recent headlines have shown, the collapse of one economy has repercussions all over the world.
Is this a correct sentence.This office is investigating a case in which the need to obtain certain clarifications from you has become imperative?
This sentence is incorrect. Preferred would be 'clarifications ... have become' rather than 'clarifications ... has become'.
How prevalent are black markets in today's world?
According to specialist websites and magazines such as The Economist, Investopedia and Freakonomics, black markets are extremely prevalent in today's world. It is estimated that black markets account for 22.67% of GDP and have become more prevalent during this particular world recession.
Why did cotton become important to the prosperity of the North as well as the South?
northern investers controlled the cottons furtures markets
Why did Neoclassicism become the preferred style in late eighteenth-century US?
Adams and Jefferson were admirers of classical architecture
Is the word preferred a verb?
Actually, it is usually a verb, but it can also be an adjective. When it is a verb, the infinitive is "to prefer" and the word "preferred" is the past tense. "She preferred chocolate ice cream, but all they had in the shop was vanilla." However, the word can also sometimes become an adjective, meaning something that is your preference: "My preferred plan is that we hold the meeting on Friday, but you may not agree."
What year did TV become popular?
TV become popular in the 1950s. TV has been availed into the markets in the early 20s but only very few people had shown interest.
What did the somerfield in the paddocks Norwich Norfolk Become?
It started out as Key Markets then Gateway, Somerfield and now it is Morrisons. Hope this helps.
