Economics For Business Assignment 2022

ECONOMICS FOR BUSINESS
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Table of Contents
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2..................................................................................................................................................3
3a................................................................................................................................................4
3b................................................................................................................................................4
4..................................................................................................................................................5
5..................................................................................................................................................5
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Comparison between different market structure is shown below:
Perfect competition: In this market, a huge number of buyers and sellers exists and this
reason here the sellers are the price takers. This large number of firms are engaged with
homogeneous product sale and these homogeneous products considered to be the one that
cannot be distinguished from the other contending products (Mahoney & Weyl, 2017). The
product with which the perfectly competitive market deals with are the same in physical
characteristics with the same quality and thus it can be noted that products are substitutes of
each other. Here free entry is provided to the sellers.
Monopoly market structure shows that a single seller exercises its monopoly power within
the market. The products with which here the sellers deal with bare unique and hence have no
similarity (Dang, 2016). Here the market consists of barriers to entry because of the high
investments level involved with the business.
Monopolistic competition prevails in the market where quite many sellers exist and thus, they
have low market power. Here the products sold by the firm are differentiated ones and thus
they are substitutes (Dhingra & Morrow, 2019). Here the barriers to the market are low and
hence entry is allowed in the market.
Oligopolistic market characterizes structure which shows that few firms exists here and thus
here the firms exercises quite a large amount of market power. The firms here sell
differentiated products and the entry in the market here consist of barriers due to the
involvement of huge investment (Daughety & Reinganum, 2018).
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i. Oligopolistic structure is observed here due to few numbers of firms selling a
differentiated product
ii. Oligopolistic structure is observed here due to few numbers of firms selling a
differentiated product
iii. Monopolistic competition is observed here due large existence of other hotels
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