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Why natural monopolies exist?

They don't exist...monopolies are caused by government intervention in the market. Excessive regulations, permits, fees etc. create barriers to entry for competitive entrepreneurs, and there is often times legislation passed in favor of large corporations. A truly competitive free market does not have monopolies.


Does perfect competition market exist in the market world?

Check


Explain the process that drives the economic profit to zero in the long run for a perfectly competitive firm?

In perfectly competitive markets, economic profits are zero in the long run because firms are able to enter and exit the market. If firms in a perfectly competitive market are profitable, there would be an incentive for new firms to enter. Supply would increase, causing an increase in quantity and the price to be driven back down to equilibrium: NO PROFIT! If firms in a perfectly competitive market are suffering a loss, some firms would choose to exit the market. Supply would decrease, causing a decrease in quantity and the price to be driven back up to equilibrium: NO PROFIT!


What of these is the best description of monopoly?

Market power, i.e. the ability to impose a price higher that would exist in a perfectly competitive market. Moreover, monopolies tend to produce a lower level than the competitive enterprise.


What statements is true about prophets in a monopolistically competitive market?

In a monopolistically competitive market, firms can earn short-term profits due to product differentiation and brand loyalty, but these profits attract new entrants, leading to increased competition. Over time, the entry of new firms drives prices down and erodes profits, resulting in a long-term equilibrium where firms earn normal profits. Thus, while prophets (or profits) exist temporarily, they cannot be sustained in the long run. Ultimately, firms in this market structure operate with some degree of market power but face the constant threat of competition.

Related Questions

Why natural monopolies exist?

They don't exist...monopolies are caused by government intervention in the market. Excessive regulations, permits, fees etc. create barriers to entry for competitive entrepreneurs, and there is often times legislation passed in favor of large corporations. A truly competitive free market does not have monopolies.


5 competitive brands that exist in the market of soap?

Five competitive brands that exist in hand and body soap are Dove, Ivory, Dr. Bronner's, Zest, and Caress. Five popular competing dish soaps are Palmolive, Dawn, Ivory, Joy, and Seventh Generation.


What is the definition of a market?

A competitive market is defined as a marketplace where there are a lot of producers of similar products. The more choice there is for products the more likely that price competition will exist and keep prices in check


How can an entrepreneur seeking funds to lunch a business convince potential lenders and investors that a market for a product or service does really exist?

By conducting a market analysis and passing the reality, competitive and value tests.


How can an entrepreneur seeking funds to lunch a business convince potential lenders and investors that a market for the product or service really does exist?

By conducting a market analysis and passing the reality, competitive and value tests.


With a life insurance policy when must an insurable interest exist?

An insurable interest must exist at the inception (beginning) of the policy.


What different natural gas stocks exist in the financial market?

There are many different natural gas stocks in the financial market, and among them are ExxonMobil, Chesapeake Energy, Range Resources, Ultra Petroleum, and Southwestern Energy.


Does perfect competition market exist in the market world?

Check


When must an Insurable interest exist for a property insurance policy?

Insurable interest must exist at inception of the policy cover and at the time of the loss.


Explain the process that drives the economic profit to zero in the long run for a perfectly competitive firm?

In perfectly competitive markets, economic profits are zero in the long run because firms are able to enter and exit the market. If firms in a perfectly competitive market are profitable, there would be an incentive for new firms to enter. Supply would increase, causing an increase in quantity and the price to be driven back down to equilibrium: NO PROFIT! If firms in a perfectly competitive market are suffering a loss, some firms would choose to exit the market. Supply would decrease, causing a decrease in quantity and the price to be driven back up to equilibrium: NO PROFIT!


What is merger meaning?

A merger refers to when two companies combine to form a single entity, with one of the companies typically ceasing to exist independently. This is often done to increase efficiency, expand market share, or gain competitive advantages.


For a market to exist you have to have what?

Private Property Rights